As of July this year, South Korea's national deficit has reached 64.8 trillion won. The deficit has decreased by 22 trillion won compared to the same period last year, largely due to an increase in revenue. However, expenditures also rose by 33.7 trillion won, and the central government's debt has increased to 1,354.2 trillion won.
According to the 'September Monthly Fiscal Trends' report released by the Ministry of Economy and Finance on September 11, total revenue for the year up to July amounted to 456.1 trillion won, an increase of 71.1 trillion won compared to the same period last year. The budget execution rate was recorded at 65.1%.
The increase in total revenue was driven by national tax revenue. By July, national tax collections reached 274 trillion won, up 41.4 trillion won from the previous year, with an execution rate of 66.0%.
Breaking down the tax categories, income tax totaled 89.3 trillion won, reflecting an increase of 12.2 trillion won. This rise was influenced by higher labor income tax due to increased performance bonuses and a surge in capital gains tax from rising real estate transactions. Corporate tax revenue improved to 51.8 trillion won, up 4.4 trillion won, thanks to better corporate performance.
Value-added tax revenue reached 69.4 trillion won, an increase of 8.1 trillion won, driven by rising private consumption and import volumes. Securities transaction tax also rose to 8.2 trillion won due to increased trading volumes and the return of tax rates. Additionally, the special tax for rural areas increased by 8.5 trillion won, influenced by higher trading volumes on the KOSPI.
Non-tax revenue was recorded at 30.1 trillion won, up 9 trillion won from the same period last year, while fund revenue increased to 152 trillion won, up 20.7 trillion won. Consequently, the overall increase in total revenue was significantly larger than last year.
Expenditures also rose. Total expenditures by July reached 476.2 trillion won, an increase of 33.7 trillion won compared to the same period last year, with an execution rate of 63.2%. Budget expenditures rose by 27.1 trillion won to 342.3 trillion won, while fund expenditures increased by 6.5 trillion won to 133.8 trillion won.
As revenue grew at a faster pace than expenditures, the fiscal balance improved. The cumulative consolidated fiscal balance recorded a deficit of 20.1 trillion won by July. Excluding the surplus of 44.7 trillion won from social security funds, the management fiscal balance showed a deficit of 64.8 trillion won, which is an improvement of 22 trillion won compared to the same period last year.
However, despite the improvement in the fiscal balance, national debt continued to rise. By the end of July, the central government's debt increased by 15.7 trillion won from the previous month to 1,354.2 trillion won, marking an increase of 86.1 trillion won compared to the end of last year.
As of the end of July, the government's state-owned assets amounted to 1,410.4 trillion won, an increase of 1.5 trillion won from the previous month. Administrative assets were recorded at 1,031.7 trillion won, while general assets totaled 378.7 trillion won.
The balance of guaranteed debts stood at 20.6 trillion won at the end of July, up 1.3 trillion won from the previous month. This included 11.2 trillion won in Korea Student Aid Foundation bonds, 8.1 trillion won in supply chain stabilization fund bonds, and 1.3 trillion won in advanced strategic industry fund bonds.
* This article has been translated by AI.
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