The national budget ran a deficit of 64.8 trillion won from January to July this year, the smallest in five years. With bonuses and real estate transaction volume rising, income tax grew the most, improving the fiscal balance.
According to the Monthly fiscal trends September issue released by the Ministry of Planning and Budget on the 11th, the consolidated fiscal balance without social security fund posted a 64.8 trillion won deficit from January to July. The deficit narrowed by 22 trillion won from a year earlier (-86.8 trillion won). The cumulative deficit during this period was the smallest since January to July 2021 (-56.9 trillion won). It was the 11th lowest since related statistics began in 2011.
The consolidated fiscal balance without social security fund shows the country's real finances. It is calculated by subtracting the scale of the four social security funds, such as the National Pension and employment insurance, from the consolidated fiscal balance, which is total revenue minus total expenditure.
Rising tax revenue largely boosted total revenue. Total revenue from January to July this year was 456.1 trillion won, up 18.5% (71.1 trillion won) from the same period a year earlier. Of total revenue, national tax revenue came in at 274 trillion won, up 17.8% (41.4 trillion won) on-year. That is 66.0% of what was planned in this year's extra budget, 3.8 percentage points (p) higher than last year's settlement of account progress rate. Income tax increased by 12.2 trillion won, The Special Tax for Rural Development by 8.5 trillion won, value-added taxes by 8.1 trillion won, the security transaction tax by 6.4 trillion won, and corporate tax by 4.4 trillion won. During the same period, total expenditure was 476.2 trillion won, up 7.6% (33.7 trillion won).
A Ministry of Planning and Budget official said, "Earned income tax and capital gains tax rose sharply due to increased bonuses and growth in real estate transaction volume, and tax revenue increased as the Special Tax for Rural Development, VAT, and the security transaction tax all rose across the board," adding, "There were no notable differences in expenditure from previous years."
Government debt increased. As of the end of July, central government debt was 1,354.2 trillion won, up 1.2% (15.7 trillion won) from the previous month. Compared with the end of last year, it rose by 86.1 trillion won. The increase was largely due to the balance of treasury bonds growing by 83.1 trillion won from the end of last year.