[Photo by Han Joo-hyung]
South Korea’s ruling Democratic Party (DP) will discuss with the government to add special cashback rewards for credit card spending to the upcoming extra budget in a better response to the aftermath of the coronavirus pandemic.
Rep. Song Young-gil, the DP`s chairman, made the remarks in his speech to a plenary parliamentary session on Wednesday, saying the need for a responsible role by state financing is greater than ever to help the livelihoods of people and ensure recovery of small businesses and the employment market amid ongoing social distancing to avoid Covid-19 infections.
As a result, the DP and the government are expected to draw up a new round of supplementary budget based on a package of three measures, which are the credit card cashback, additional aid for small businesses hit by Covid-19 and disaster relief payments for all nationals.
S. Korea’s ruling Democratic Party Chairman Song Young-gil. [Photo by Lee Seung-hwan]
A DP official told Maeil Business Newspaper that the cashback program aims to return in cash part of increased credit card spending in the third quarter from the previous quarter, adding eligible purchasing items will be limited.
The credit card cashback is a fresh stimulus from the ruling camp, but it is another cash support that critics say could further worsen the fiscal health of the country after the government’s aggressive expansionary fiscal policy to shore up the economy and could be seen as another populist program just nine months before the presidential election.
Song said the country`s tax revenue increased by 32.7 trillion won ($29.3 billion) in the first quarter of this year, compared with a year ago and it will be sufficient enough to finance a new round of extra budget without selling government bonds.
By Sung Seung-hoon and Minu Kim
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]