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South Korea plans future response fund using extra tax revenue
The ruling party and government agreed to create a fund that will direct additional tax revenue into youth programs, regional development, and education. The move follows expectations of higher revenue from semiconductor company earnings.
Jul 20, 10:26 PM·1m read1 source
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The ruling Democratic Party and the government agreed Tuesday to direct additional tax revenue into a future response fund focused on young generations, regional development, and education for the 2027 budget. The agreement came during a high-level consultative meeting at the National Assembly.
Officials said the government expects a sharp increase in tax revenue because of record earnings by semiconductor companies.
"We are expecting an unprecedented increase in tax revenue on the back of the prolonged semiconductor boom," the minister of planning and budget said. "We will create a future response fund to reinvest in young generations, new growth engines, regional development and education," the minister added.
The minister also pledged active support for the government's three megaprojects initiative covering semiconductors, physical artificial intelligence, and AI data centers.
President Lee Jae Myung earlier announced plans for a record-high budget of around 800 trillion won, or about 540 billion U.S. dollars, for next year. The additional tax revenue from the semiconductor sector will be used to establish the future response fund.
