South Korea to submit 20-trillion-won supplementary budget to National Assembly this month
South Korea plans to accelerate a supplementary budget and aims to submit it to the National Assembly within this month, officials say. Im Ki-geun, the acting deputy prime minister and vice minister of the Planning and Budget Office, chaired a government-wide meeting on the Middle East situation at the Government Complex Seoul in Jongno. He said ministries will forgo weekends to prepare the extra budget quickly to ease public burdens.
The meeting focused on how the war in the Middle East could affect logistics and energy costs, and how a supplementary budget could mitigate those pressures. Im emphasized a fast, coordinated response across ministries to cushion households and businesses from emerging costs.
Key targets of the supplement include reducing freight and fuel expenses, stabilizing the livelihoods of vulnerable groups such as low-income households, small business owners, and farmers, and supporting exporters. These priorities reflect the government’s aim to cushion the domestic economy from external shocks.
Officials expect the supplementary budget to be around 20 trillion won. Im said the plan would be financed largely from projected excess tax revenues, with no new government bond issuance, to minimize impacts on Korea’s bond and foreign exchange markets.
The government has highlighted that stronger demand for semiconductors driven by AI could lift corporate tax receipts, with Samsung Electronics and SK Hynix among beneficiaries. Securities transaction tax revenue is also projected to rise as stock trading activity increases, helping offset the new spending.
The ruling Democratic Party pledged swift action on the bill. Party leader Chung Cheong-rae said the government’s supplementary budget would be processed immediately upon submission, and floor leader Han Byung-do vowed to scrutinize and pass the measure quickly to protect livelihoods.
Context for international readers: Korea’s Planning and Budget Office oversees fiscal policy, and the supplementary budget is a fiscal tool to address unexpected costs without immediate borrowing. The price-cap policy on oil products, temporarily applied to stabilize fuel prices, has already been in effect domestically, while the country contends with broader energy and geopolitical uncertainties that can ripple through global energy markets and supply chains. Korea is a major producer of memory chips, and shifts in its fiscal stance, tax receipts, and export support programs can influence global tech supply chains and markets, including the United States.