This year, South Korea's national tax revenue is projected to reach 478.6 trillion won, exceeding earlier estimates by 63.2 trillion won and increasing by 104.7 trillion won compared to last year's figures. The rise in revenue is attributed to improved performance in the semiconductor sector, a buoyant stock market, and a recovery in private consumption.
The Ministry of Finance announced these findings on September 30 as part of its reassessment of national tax revenue for 2026. The current projection is 88.4 trillion won higher than the original budget estimate of 390.2 trillion won and 63.2 trillion won more than the supplementary budget estimate of 415.4 trillion won. Compared to last year's actual tax revenue of 373.9 trillion won, this represents a 28.0% increase.
The primary driver of this revenue increase is corporate tax, which is estimated at 136.4 trillion won for the year. This figure is 51.8 trillion won higher than last year and 35 trillion won more than the supplementary budget estimate. The significant rise in corporate tax filings is largely due to increased operating profits among semiconductor companies.
The government initially projected operating profits for semiconductor firms at 81 trillion won during the original budget preparation, which was later revised to 339 trillion won at the time of the supplementary budget. As of September, market forecasts have surged to 638 trillion won. In the first half of this year, Samsung Electronics and SK Hynix reported operating profits that exceeded market expectations from February.
As of August, national tax revenue also showed an upward trend. Cumulative tax revenue for August reached 329.9 trillion won, an increase of 69.1 trillion won compared to the same period last year. The collection rate stands at 79.4% based on the supplementary budget. Among the increases, corporate tax rose by 28.2 trillion won, income tax by 14.4 trillion won, and value-added tax by 7.4 trillion won. Additionally, securities transaction tax and special rural taxes increased by 7 trillion won and 9.5 trillion won, respectively.
In August alone, national tax revenue totaled 55.9 trillion won, marking a 27.7 trillion won increase from the same month last year, largely driven by a 23.8 trillion won rise in corporate tax. However, it should be noted that the increase in corporate tax for August includes interim payments, with some expected to be paid in installments in September and October. A Ministry of Finance official indicated that when combining the August increase with future installment payments, the total increase in corporate tax will likely surpass last year's figures.
Income tax is estimated at 152.4 trillion won, reflecting an increase of 22 trillion won from last year and 15.6 trillion won from the supplementary budget. Factors contributing to this rise include wage increases through bonuses, special dividends from semiconductor companies, and a surge in housing transactions. Dividend income tax is projected to rise from 4.6 trillion won last year to 8.6 trillion won this year, an increase of 4 trillion won. Labor income tax is also expected to grow from 68.4 trillion won to 77.7 trillion won, an increase of 9.3 trillion won.
The robust performance of the stock market has also contributed to the increase in tax revenue. Securities transaction tax is projected to reach 12.4 trillion won this year, up 9 trillion won from last year. Special rural taxes are expected to rise to 20.3 trillion won, an increase of 11.1 trillion won from the previous year. However, the Ministry of Finance noted that since August, trading volumes in the securities market have decreased, reflecting a return to normal levels, which was taken into account in the annual tax revenue projections.
The tax revenue deviation rate compared to the supplementary budget is 15.2%. In terms of historical tax revenue deviation rates based on the government's final budget, 2026 ranks fifth, following 1950 at 21.5%, 1988 at 17.6%, 2000 at 16.6%, and 1989 at 15.3%.
The government has restructured the tax revenue forecasting committee into an internal advisory body and is operating a separate private advisory group. Additionally, an artificial intelligence (AI) predictive model for corporate tax forecasting has been introduced. Following amendments to the National Finance Act, annual reassessments of tax revenue for the current year will be institutionalized starting this year.
While an excess tax revenue of 63.2 trillion won is anticipated, specific plans for its utilization have yet to be determined. A bill proposing the transfer of these funds to a future response fund has been submitted to the National Assembly, but it has not been confirmed whether the entire excess revenue will be allocated to the fund.
A Ministry of Finance official stated, "This reassessment is the result of our best efforts based on the information available to date. We will continue to enhance our forecasting models and expand communication with the private sector regarding industry-specific forecasts to improve the reliability of tax revenue projections."
* This article has been translated by AI.
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