Deputy Minister Kim Yong-beom at the Blue House policy office said that with a boom in the semiconductor industry, record excess tax revenues could pile up this year and next year, adding that flexible fiscal policy is needed.
Kim wrote on Aug. 8 in an article titled "At the threshold of KOSPI 7,500 and 10,000," "If the semiconductor boom continues through 2027, tax revenues in 2026 and 2027 are highly likely to reach a historic scale," adding, "If so, how quickly can the policy system reflect this reality? The revised 2026 economic outlook to be released in the second half of this year is the first turning point. Depending on how far that outlook is raised, the direction of the 2027 revenue forecast and the total budget will change."
She continued, "Will we move reactively again this time? In 2021 and 2022, a record level of excess tax revenues occurred due to the post-COVID semiconductor boom. But the revenue outlook and the budget did not fully keep up with reality," adding, "The scale of this cycle could be much larger than then. With the existing approach alone, the response error could grow even more. If a semiconductor-centered structural shift is indeed underway, fiscal policy, too, needs to break free from thinking tied to past averages and approach the issue with more flexibility and a wider perspective."
Kim wrote, "New numbers are already appearing in the market, but aren't we still trying to understand them with old instincts and standards?" adding, "At least the point that the current phase is not merely an extension of an ordinary business cycle is becoming increasingly clear."