Tax revenue estimated to hit record high in 2026 on chip boom
Summary
Korea's tax revenue is estimated to hit a record 478.6 trillion won this year, driven by the semiconductor supercycle and a bullish stock market. The Ministry of Finance and Economy said the revised estimate is 88.4 trillion won above the original budget forecast. The government also said the Future Fund could receive more than 200 trillion won from the windfall.
Key Facts
- The estimate is 104.7 trillion won higher than last year’s 373.9 trillion won and above the previous record of 395.9 trillion won in 2022.
- Corporate tax revenue is expected to reach 136.4 trillion won this year, up 51.8 trillion won from 2025.
- Income tax revenue is projected at 152.4 trillion won, helped by higher bonus payments at semiconductor and financial companies.
- Securities transaction tax revenue is expected to reach 12.4 trillion won, compared with the original estimate of 5.4 trillion won.
- The government said the bill on the Future Fund submitted to the National Assembly allows surplus revenue to be transferred to the fund.
A visitor views semiconductor products at the Advanced Semiconductor Packaging & Chiplet Show held in Suwon, Gyeonggi Province, Aug. 26. Yonhap
Korea's tax revenue is estimated to reach a record 478.6 trillion won ($353.7 billion) this year, driven by the semiconductor supercycle, government data showed Wednesday.
The figure marks an increase of 104.7 trillion won from the previous year's 373.9 trillion won, according to the Ministry of Finance and Economy. The previous record was 395.9 trillion won in 2022.
The revised estimate is 88.4 trillion won higher than the original projection used to draw up the 2026 budget.
"Tax revenue has far exceeded the initial estimate due to the semiconductor boom and the bullish stock market, both of which were difficult to predict," a finance ministry official said.
"Operating profits in the chip industry were around 70 to 80 percent higher than originally projected," the official added.
The finance ministry said corporate tax revenue is expected to reach 136.4 trillion won this year, up 51.8 trillion won from 2025.
The combined operating profit of Samsung Electronics and SK hynix Inc. for this year is currently projected by the market at around 638 trillion won, compared with 339 trillion won forecast in February.
The government projected income tax revenue would reach 152.4 trillion won, up from the initial forecast of 132 trillion won, driven by higher bonus payments at semiconductor and financial companies.
Securities transaction tax revenue is expected to reach 12.4 trillion won, compared with the original estimate of 5.4 trillion won, buoyed by the bullish stock market in the first half of this year.
Based on the revised estimates, experts said more than 200 trillion won could be available for the Future Fund, which the government plans to launch next year to channel an unprecedented tax revenue windfall from the semiconductor boom into sustainable economic growth.
The calculation is based on projected surplus tax revenue of 56.2 trillion won, on top of the windfall revenue of 162.3 trillion won.
"The bill on the Future Fund submitted to the National Assembly stipulates surplus revenue can be transferred to the fund," the official said, noting relevant ministries are discussing how to use the surplus.
Korea earlier introduced the concept of "windfall revenue," referring to tax revenue exceeding its long-term trend due to structural economic changes or significant economic fluctuations, such as an industrial supercycle.
The government said the concept differs from surplus tax revenue, which refers to tax receipts exceeding official forecasts due to unexpected short-term economic fluctuations or forecasting errors.
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