Uncertain Future of the Local Business Voucher1)
The local business voucher is a gift certificate program in which 232 local governments across the country discount a certain percentage of payments or return it by cashback. It has become popular since people can get a little discount at a time when prices are rising day after day. Seoul Love Gift Certificate, issued over two days on September 1 and 2, was sold out early, prompting a so-called "purchase war." However, it is predicted that this business budget will be drastically cut next year. Although it varies between local governments, the discount rate is usually around 5- 10%, and there are two methods: discount issuance and policy issuance. The discount issuance, which is controversial due to the budget cut, is shared by the central government and local government as much as the discount. For example, in the case of Gyeonggi-do Province, 4% of the 10% discount is paid by the central government, and the remaining 6% is shared by Gyeonggi-do Province and cities in it. According to the Ministry of Strategy and Finance on August 30, however, the government did not include it in the 2023 budget. The government stated there was not much incentive originally to provide additional support because the support for local business vouchers was implemented as a three-year temporary project to support small business owners affected by COVID-19, and social distancing regulations are being lifted. Like this, concerns that the same discount on gift certificates may not be offered next year are also interpreted as contributing to them being sold out.
Deputy Prime Minister for Economic Affairs and Minister of Strategy and Finance Chu Kyungho said on September 21 that "The local business voucher's effectiveness is basically limited to the region. It is not appropriate for the central government to allocate funds in the form of state subsidies to operate them with national taxes or debts." The government doesn't believe in its effectiveness for the domestic economy. Micro-enterprises expressed concern about this. The vouchers can only be used at traditional markets or small stores in the region which are helping to revitalize the local economy, and they worry they will be hit hard if the program is eliminated. In a joint statement on September 26, the Citizens' Coalition for Economic Justice (CCEJ) said, "The government has not gathered opinions from stakeholders and is triggering conflicts with local governments, local consumers, and small business owners." CCEJ also stressed the need to prepare policies and budgets that will help the economy. The local business voucher project, which is at a crossroads of survival and abolition amid a crisis of budget exhaustion, is drawing attention to whether it will continue to benefit people in the era of high prices after COVID-19.
1) Jo Eunbi, "Local Business Voucher, Which Used to Be a Support, Is Feared to Decline in Sales if It Disappears", TBS, Sep 26, 2022
