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| Prime Minister Kim Boo-kyum speaks during a Central Disaster and Safety Countermeasure Headquarters meeting at the Government Complex Seoul, Friday. Kim announced that the government will come up with an extra budget for COVID-19 disaster relief before the Lunar New Year holiday. Yonhap |
By Nam Hyun-woo
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"In order to beef up supports to the self-employed and small shop owners, the government decided to propose a supplementary budget using available resources such as the tax surplus," Prime Minister Kim Boo-kyum said, Friday. "We will promptly prepare the proposal and submit related bills to the National Assembly before the Lunar New Year holiday (Jan. 31 to Feb. 2)."
Economy and Finance Minister Hong Nam-ki elaborated that 14 trillion won will be budgeted, and the government plans to finance it "mostly by issuing bonds."
The announcement came a day after the finance ministry said the tax revenue from January to November 2021 stood at 323.4 trillion won, up 40.7 trillion won from the government's prior expectation. Including the December figure, the total amount of tax surplus last year is expected to reach 60 trillion won, which will be the greatest difference between estimated and actual tax surplus in Korea's history.
Along with criticism for the government's inaccurate calculation, questions rose on how to handle the surplus. Under the current laws, a tax surplus generated in the previous year can be used for the current year's budget after settling revenue and expenditure accounts at the National Assembly in April. After the accounting process, the amount should be used for fixed purposes, such as repaying the national debt.
There has been anticipation that the Moon Jae-in administration may not come up with an additional budget for COVID-19 relief before the presidential election, but the government opted to issue new bonds and repay them with the tax surplus after April's accounting process, in line with the ruling Democratic Party of Korea's (DPK) call for disaster relief before the election.
"As the tax surplus last year is expected to be significant, it will be difficult for the government to claim it is unable to come up with a supplementary budget," DPK policy committee chairman Rep. Park Wan-joo said, Tuesday.
President Moon also said Thursday, "The government should come up with measures for using the tax surplus promptly, in order to help the self-employed who are suffering from protracted COVID-19 restrictions."
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| President Moon Jae-in speaks during a meeting with major city mayors and provincial governors at Cheong Wa Dae, Thursday. Yonhap |
The main opposition People Power Party is claiming that the government and the DPK are "buying votes with money."
"The Moon government and the DPK are throwing money around before the election," PPP deputy floor leader Rep. Choo Kyung-ho said during a party meeting, Friday.
"It is extremely unusual to implement an extra budget at the beginning of a new year. … Implementing an extra budget at the beginning of a year without even tapping into (this year's) budget can only be seen as an attempt to touch voter sentiment before the presidential election."
PPP Rep. Yoo Sung-kull, the executive secretary of the Assembly's Strategy and Finance Committee, said the government virtually turned down DPK presidential candidate Lee Jae-myung's proposal for an extra budget just a month ago, but now seems to have changed its stance.
"The presidential office is spearheading the ruling bloc's attempt to throw money around before the election. We cannot help but raise suspicions that the extra budget will affect the election," Yoo said.
On the other hand, DPK candidate Lee said the supplementary budget is "too small" and the government "does not know about the reality." Lee has been claiming that the government should expand its expenditures to vitalize the economy and help the public, saying Korea's national debt is still at a low level.
