Corona Special Committee Reviews Emergency Financial Rescue Plan for 'Indebted Self-Employed' (Comprehensive)

Final Confirmation of Next Week's Compensation Scale and Eligibility for Self-Employed Losses

Ahn Cheol-soo, Chairman of the Presidential Transition Committee, is delivering opening remarks at the Small Business Owners and Self-Employed Field Visit Meeting held on the 10th of this month at the Customer Satisfaction Center of Tongin Market in Jongno-gu, Seoul. Photo by Transition Committee Press Corps

[Asia Economy Reporter Jeong Dong-hoon] The COVID-19 Emergency Response Special Committee (COVID Special Committee) is reviewing an emergency financial restructuring plan for self-employed individuals burdened with debt due to COVID-19 damages.

Hong Kyung-hee, deputy spokesperson of the Presidential Transition Committee, stated in a briefing on the 21st, "The COVID Special Committee reviewed the 'Emergency Financial Restructuring Plan for Small Business Owners' as part of the comprehensive COVID loss compensation package." Hong added, "The basic direction of the emergency financial restructuring plan aims to reduce borrowers' interest burdens, extend repayment schedules, and alleviate excessive debt." She continued, "Additionally, in response to the transition to a period of rising interest rates, we discussed measures including bank refinancing and interest differential support to ease the interest burden on non-bank loan borrowers exposed to interest rate risks."

The COVID Special Committee is expected to finalize the scale, target, and method of compensation for self-employed losses by next week. Hong said, "Among various simulation plans included in the comprehensive COVID loss compensation package, we have approached conclusions on the specific compensation scale, payment targets, and payment methods. The selected plan, based on loss estimates refined through multiple government revisions, will be reported to Chairman Ahn Cheol-soo and finalized through the COVID Special Committee's final review next week."

She added, "We are specifically reviewing measures to extend the payment period for individual local income tax and corporate local income tax for small self-employed businesses and SMEs affected by COVID-19."

Hong stated, "Because the data required for accurate loss compensation estimates is vast and detailed analysis is necessary to ensure full compensation, we could not mention specific scales during the process. The COVID Special Committee is making every effort to prepare a complete, fair, and prompt compensation plan."

When asked about progress on the 'bad bank' concept mentioned by Transition Committee Chairman Ahn Cheol-soo, Hong responded, "Using the term 'bad bank' is a reserved stance at this point. However, we are concretely exploring measures to reduce debt burdens for small business owners and the self-employed."

Hong also reiterated, "We are specifically reviewing measures to extend the payment period for individual local income tax and corporate local income tax for small self-employed businesses and SMEs affected by COVID-19."

Regarding whether industries excluded from existing loss compensation, such as the travel industry, will be included in support, Hong replied, "In addition to those compensated under the existing loss compensation law, we are simultaneously reviewing measures for blind spots."