Korea's finance ministry revealed Sunday that the government has a contingency plan to relieve the burden on small businesses following a decision to hike the country's minimum wage to seven-thousand five-hundred-30 won or roughly six dollars 64 cents up 16.four percent from this year.
"The measures will minimize extra costs for companies, subsidize labor costs, foster companies with solid growth potential and provide momentum for income-led growth."
The government estimates roughly three-and-a-half billion U.S. dollars will be spent to help small businesses relieve the burden caused by the sharpest annual hike in the minimum wage since 2001.
The government also said it would devise measures to give tax breaks to them, including lowering credit card processing fees and value-added tax.
President Moon Jae-in has sought to sharply raise the minimum wage with the aim of addressing income disparities and boosting economic growth through job creation and increased household revenue.
However, business groups have expressed concern over a hike topping 16 percent, saying it could worsen business conditions and hamper job creation.
The minimum wage decision comes as the National Assembly's budget committee is fine-tuning and accelerating its deliberations on a supplementary budget bill worth some ten billion U.S. dollars.
A long-delayed review of the extra budget began last Friday when the opposition parties lifted their boycott of parliamentary activities a day after President Moon's controversial pick for labor minister withdrew from consideration.
President Moon has been pushing for the additional budget to bankroll his plan to create jobs largely concentrated in the public sector.
The extra budget bill is expected to be put up for a full floor vote on Tuesday.
Ji Myung-kil, Arirang News.