[2026 National Assembly Audit] Park Honggeun: "Use of Excess Tax Revenue Not Yet Decided... Talks on Cutting Bond Issuance and Fund Contributions"

Decision to follow consultations with relevant ministries
IMF report due soon expected to paint a more optimistic picture

The government plans to make a final decision, after consulting with relevant ministries, on whether to use the excess tax revenue generated by the semiconductor boom to further reduce government bond issuance or set it aside in the Future Response Fund and other funds.

Minister of Planning and Budget Park Honggeun answers lawmakers' questions during a parliamentary audit of the Ministry of Planning and Budget at the National Assembly on Oct. 8, 2026. Photo by Yoon Dongju.

At a parliamentary audit of the National Assembly’s Finance and Economy Planning Committee on Oct. 8, Minister of Planning and Budget Park Honggeun responded to a question from Democratic Party of Korea lawmaker Yoon Hudeok about this year’s plans for using the excess tax revenue. “We will consult with relevant ministries on the overall situation, including whether to use the excess revenue to further reduce the amount of government bonds issued or put it into other funds for future use. No decision has been made yet,” he said.

The government initially planned to set aside some of the excess tax revenue in the Future Response Fund and use the rest to reduce government bond issuance. It has already cut planned bond issuance by KRW 5 trillion and is considering further reductions depending on conditions in the bond market. This year’s excess tax revenue amounts to KRW 63.2 trillion. “First, we need to make a policy decision,” Minister Park said, adding, “That would allow the Fund Management Committee to discuss how to use the money, but the policy decision has not yet been finalized.”

On fiscal soundness, he expressed confidence by highlighting progress in managing debt over the medium to long term. Responding to Democratic Party of Korea lawmaker Ahn Do-geol’s remarks regarding the International Monetary Fund’s (IMF) fiscal review report, due to be released this month, Minister Park said, “There is a very high likelihood that the figures will show greater improvement than we expect.” He added, “Comparing the government debt projections published last year with those published this year, the projected debt through 2030 has fallen by KRW 208 trillion. The projection for debt incurred to cover deficits has also fallen by KRW 193 trillion compared with last year’s medium-term plan, and we are managing it stably.”

Minister Park also warned that South Korea’s potential growth rate was declining and stressed the need for bold strategic investment. “Most forecasts put the potential growth rate in the mid-to-high 1% range, and predict it will fall below 1% by 2040. Surely we cannot let this go unaddressed,” he said. “At this critical juncture of structural transition, when countries are vying for dominance in AI technology, the nation’s future depends on concentrating strategic investment early to drive growth.”

This content was produced with the assistance of AI translation services.