Government eyes new fund to invest tax windfall from AI-driven chip boom

Presidential chief of staff Kang Hoon-sik, left, speaks as Prime Minister Han Seong-sook, second from left, and other participants listen during a high-level meeting between the government and the ruling Democratic Party of Korea at the prime minister's official residence in Seoul, Sunday. Yonhap

The government plans to establish a new fund to effectively invest windfall tax revenue generated by the semiconductor industry’s artificial intelligence (AI)-driven boom, presidential chief of staff Kang Hoon-sik said Sunday.

He explained that the fund is intended to finance future priorities and challenges, including the government's three industrial megaprojects unveiled last week, as well as support for people in their 20s and 30s.

"We must not spend the additional tax revenue resulting from the semiconductor upturn carelessly at this critical moment that will determine Korea's future," Kang said during a high-level meeting between the government and the ruling Democratic Party of Korea (DPK) at the prime minister’s official residence in Seoul.

He went on to say the Lee Jae Myung administration plans to establish what he called a "future response fund" to use additional tax revenue as a "source of investment for future generations."

“The creation of the future response fund will lay the foundation for realizing an ‘irreplaceable Korea,’” he added, calling for close cooperation between the government and the ruling party to ensure the initiative is implemented swiftly.

“The government intends to use the fund to make bold investments in Korea's future,” Kang said, listing support for the Lee administration's three megaprojects, measures to address K-shaped polarization and assistance with housing, startups and employment for people in their 20s and 30s.

In particular, the chief of staff stressed that the three megaprojects, which center on semiconductors, physical AI and data centers, will “shape Korea's future over the next two to three decades as countries around the world race to lead the AI revolution.”

The high-level meeting came after the Lee administration entered the second year of its five-year term, which began in June 2025.

Kang said that while the administration's first year was devoted to restoring normalcy and rebuilding the foundation for national growth, its second year will focus on “delivering tangible results that people can feel,” with the three megaprojects serving as the historic starting point.

“These projects mark the beginning of a public-private effort to transform Korea's balanced regional development strategy,” he said, noting that the projects are aimed at promoting decentralized growth by building world-class industrial clusters tailored to each region's competitive strengths rather than spreading the same industries across the country.

Citing Silicon Valley and the Texas semiconductor belt in the U.S. as examples, Kang said Korea should look beyond the capital region and foster regional AI chip innovation hubs.

He added that the government will actively accommodate corporate needs and provide full support to help advanced industries such as biotechnology and aerospace, in addition to semiconductors, to achieve new growth in regional areas.

Kang, meanwhile, congratulated Prime Minister Han Seong-sook, who was present for the meeting, on her new position, after she took office last week.