S. Korea To Expand Financial Support For Low-income Families Over Minimum Wage Hike

South Korea plans to increase the amount of tax refunds for low-income households and the beneficiaries to cope with the possible side effects of the planned increase in the minimum wage for next year, the finance minister said Tuesday.

SEOUL, (UrduPoint / Pakistan Point News - 17th Jul, 2018 ) :South Korea plans to increase the amount of tax refunds for low-income households and the beneficiaries to cope with the possible side effects of the planned increase in the minimum wage for next year, the finance minister said Tuesday.

Minister Kim Dong-yeon made the remark at a meeting with officials with the ruling Democratic Party (DP) to discuss ways to support low-income families and review economic conditions in the second half.

"The government will sharply expand the beneficiaries of the earned income tax credit (EITC) scheme and the volume of financial support," the minister said, referring to the system that calls for refunding taxes to low-income families.

The meeting was arranged amid angry reactions from both business and labor circles following the government's decision to hike the minimum wage by 10.9 percent to 8,350 won (US$7.40) per hour next year.

The government decided to raise the minimum wage by 16.4 percent to 7,530 won this year, the biggest rise in about two decades.

Smaller business owners said they cannot endure sharply rising labor costs, while labor groups said that the move is not sufficient to satisfy low-wage workers.

"To increase jobs for senior citizens, the government plans to create reserves for emergency situations in the second half, if needed," Kim said.