Seoul, September 12 (Yonhap News Agency) – South Korea’s fiscal deficit reached an unprecedented 442.4 billion yuan (83.2 trillion won) in the first seven months of 2024, according to data released by the country’s Ministry of Economy and Finance on Thursday.
The deficit, which is a 15.3 trillion won (about 88.5 billion yuan) increase from the same period last year, highlights the nation’s ongoing budgetary challenges amidst economic uncertainties.
According to the Fiscal Trend report, the central government’s revenue for the period stood at 208.8 trillion won, a decrease of 8.8 trillion won from the previous year. This decline was primarily attributed to a significant drop in corporate taxes, which decreased by 15.5 trillion won.
The report also revealed that tax revenue outside of the government’s tax base reached 18.4 trillion won, an increase of 1.1 trillion won from the previous year. Additionally, fund revenue increased by 11.6 trillion won to 129.9 trillion won.
Despite the revenue challenges, the central government’s fiscal revenue for the first seven months increased by 3.9 trillion won to 357.2 trillion won. However, this was overshadowed by a higher expenditure of 409.5 trillion won, resulting in a comprehensive fiscal deficit of 52.3 trillion won.
When excluding social security funds from the calculation, the fiscal deficit widened to 83.2 trillion won, reflecting the actual financial situation of the government.
South Korea’s economy has been facing a number of headwinds in recent years, including slowing economic growth, rising inflation, and an aging population. These factors have put pressure on the government’s budget, leading to higher deficits.
The government has been implementing various measures to address the budgetary challenges, including increasing taxes on certain goods and services and reducing spending on certain programs. However, these measures have yet to have a significant impact on the country’s fiscal situation.
As South Korea’s economy continues to face challenges, it remains to be seen how the government will address its budgetary issues in the coming months.
Key Points:
- South Korea’s fiscal deficit reached 442.4 billion yuan (83.2 trillion won) in the first seven months of 2024.
- The deficit is a 15.3 trillion won (about 88.5 billion yuan) increase from the same period last year.
- The central government’s revenue for the period stood at 208.8 trillion won, a decrease of 8.8 trillion won from the previous year.
- The government has been implementing various measures to address the budgetary challenges, including increasing taxes and reducing spending.
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