Ministry of Economy and Finance in Sejong, South Korea. [Photo=Ministry of Economy and Finance]
As of April this year, South Korea's management fiscal balance recorded a deficit of 36.6 trillion won. While the fiscal balance improved compared to last year due to a significant increase in national tax revenue, the central government's debt has surpassed 1,320 trillion won.
According to the "Monthly Fiscal Trends for June" report released by the Ministry of Economy and Finance on June 11, the management fiscal balance showed a deficit of 36.6 trillion won at the end of April. This marks a reduction of 9.5 trillion won compared to the same period last year.
The management fiscal balance is an indicator that excludes the balances of social security funds, such as the National Pension, from the consolidated fiscal balance, reflecting the government's actual financial status. During the same period, the consolidated fiscal balance recorded a deficit of 13.2 trillion won, while social security funds showed a surplus of 23.3 trillion won.
The improvement in the fiscal balance was driven by an increase in tax revenue. Total revenue for the year to date reached 272.3 trillion won, an increase of 41.3 trillion won compared to the same period last year. Of this, national tax revenue rose by 21.9 trillion won, while non-tax revenue and fund revenue increased by 7.9 trillion won and 11.5 trillion won, respectively.
The increase in national tax revenue is attributed mainly to a rise in income tax due to expanded bonuses and an increase in capital gains tax resulting from a recovery in real estate transactions. Additionally, improvements in corporate performance led to higher corporate taxes, a decrease in value-added tax refunds, increased import revenue, and a rise in securities transaction volumes, all contributing to the increase in tax revenue.
During the same period, total expenditures reached 285.6 trillion won, an increase of 23.3 trillion won compared to the previous year. However, the growth in total revenue significantly outpaced the increase in expenditures, leading to an overall improvement in the fiscal balance.
As of the end of April, the central government's debt stood at 1,321.7 trillion won, an increase of 18.2 trillion won from the previous month. Compared to the end of last year, the balance of government bonds increased by 53.5 trillion won, and the balance of foreign exchange stabilization bonds rose by 4.9 trillion won, while the balance of housing bonds decreased by 14 trillion won. Consequently, the central government's debt has increased by approximately 57 trillion won compared to the end of last year.
According to the "Monthly Fiscal Trends for June" report released by the Ministry of Economy and Finance on June 11, the management fiscal balance showed a deficit of 36.6 trillion won at the end of April. This marks a reduction of 9.5 trillion won compared to the same period last year.
The management fiscal balance is an indicator that excludes the balances of social security funds, such as the National Pension, from the consolidated fiscal balance, reflecting the government's actual financial status. During the same period, the consolidated fiscal balance recorded a deficit of 13.2 trillion won, while social security funds showed a surplus of 23.3 trillion won.
The improvement in the fiscal balance was driven by an increase in tax revenue. Total revenue for the year to date reached 272.3 trillion won, an increase of 41.3 trillion won compared to the same period last year. Of this, national tax revenue rose by 21.9 trillion won, while non-tax revenue and fund revenue increased by 7.9 trillion won and 11.5 trillion won, respectively.
The increase in national tax revenue is attributed mainly to a rise in income tax due to expanded bonuses and an increase in capital gains tax resulting from a recovery in real estate transactions. Additionally, improvements in corporate performance led to higher corporate taxes, a decrease in value-added tax refunds, increased import revenue, and a rise in securities transaction volumes, all contributing to the increase in tax revenue.
During the same period, total expenditures reached 285.6 trillion won, an increase of 23.3 trillion won compared to the previous year. However, the growth in total revenue significantly outpaced the increase in expenditures, leading to an overall improvement in the fiscal balance.
As of the end of April, the central government's debt stood at 1,321.7 trillion won, an increase of 18.2 trillion won from the previous month. Compared to the end of last year, the balance of government bonds increased by 53.5 trillion won, and the balance of foreign exchange stabilization bonds rose by 4.9 trillion won, while the balance of housing bonds decreased by 14 trillion won. Consequently, the central government's debt has increased by approximately 57 trillion won compared to the end of last year.
* This article has been translated by AI.
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