SEOUL (Reuters) – In an effort to assist stock investors and small businesses affected by high interest rates, the South Korean government announced on Wednesday its plan to implement a comprehensive package of financial policies.

The move comes as the country gears up for general elections in three months, and coincides with a series of policy discussion forums hosted by the president this month.

The Financial Services Commission revealed that one key measure involves abandoning the previous administration’s proposal to levy capital gains taxes on income exceeding 50 million won ($37,359.99) from stock investments, initially scheduled to be enforced next year.

This change means that currently, only “large shareholders” with holdings in a listed company exceeding five billion won are subject to capital gains tax, a threshold raised from one billion won in December. The objective is to create a more equitable environment for retail and institutional investors by improving stock short-selling rules, according to the commission, which oversees financial policies and regulations.

Moreover, local banks will be returning a total of 1.6 trillion won ($1.20 billion) of interest income to small businesses and the self-employed who have taken out loans, in an effort to alleviate the burden of high interest rates, as announced by the commission.

Furthermore, the government has outlined plans to provide a “credit rating pardon” for up to 2.9 million people with overdue repayments on loans, with the aim of assisting them in returning to economic activity with a clean financial record.

Overall, these financial support measures aim to address the challenges faced by stock investors and small business owners, and to stimulate economic activity amidst ongoing interest rate pressures.

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($1 = 1,338.3300 won)