The government will soon announce the supplementary budget plan for 2025. The size of the supplementary budget is expected to reach at least 20 trillion won, and with recent worsening tax revenue conditions, there are projections that the government may also proceed with adjusting the revenue budget to reflect reality.
According to Yonhap News on the 15th, the Ministry of Economy and Finance is finalizing arrangements ahead of the expected announcement of a second supplementary budget plan projected to exceed 20 trillion won. The government has stated its intention to swiftly prepare and implement supplementary budgets for economic recovery, consumption activation, and support for vulnerable groups and small businesses.
The Ministry of Economy and Finance is also examining whether it is necessary to revise the annual target for the revenue budget during the supplementary budget preparation process. Having experienced a tax revenue shortfall of about 30 trillion won last year, the government faces the situation where at least 40 trillion won more needs to be collected this year to meet the main budget. The national tax revenue budget for this year is 382.4 trillion won, which is about 45.9 trillion won more than last year's performance of 336.5 trillion won.
The possibility of meeting the tax revenue target is decreasing due to economic slowdown. The cumulative national tax revenue from January to April stands at 142.2 trillion won, which is an increase of only 16.6 trillion won compared to the same period last year. The achievement rate is at 37.2%, lower than during the same period last year. Major institutions such as the Bank of Korea and the Korea Development Institute (KDI) have lowered their growth rate forecasts to around 0.8%.
In this regard, the government is considering the option of implementing 'revenue adjustment' alongside the second supplementary budget. Revenue adjustment refers to the process of adjusting budget figures when tax revenue is collected either more or less than initially expected. If expenditures are maintained despite shortfalls in revenue, the government will cover the revenue deficit through the issuance of government bonds.
In this context, the Hyundai Research Institute noted in March that considering the deterioration of the economic situation compared to the time of forming last year's government revenue budget plan, revenue adjustment is unavoidable, suggesting that the scale would be about 8.3 trillion won.