Budget minister calls for 'virtuous cycle' of spending, growth and tax revenue

Korea's budget minister emphasized Thursday the necessity of creating a "virtuous cycle" involving proactive fiscal spending, economic expansion, and increased tax revenue. The government's planned Future Fund could play a pivotal role in realizing this objective, according to Budget Minister Park Hong-geun. During a parliamentary audit at the National Assembly, Park discussed the ministry's strategy for implementing proactive and efficient fiscal management to prepare the foundation for growth.

Park stated, "We will establish a virtuous cycle in which proactive fiscal spending drives growth, which in turn generates higher tax revenue." He further added, "We will boldly overhaul spending structures to ensure the sustainability of the country's public finances." The Future Fund, slated to be introduced next year, will utilize windfall tax revenue derived from the semiconductor boom for investments aimed at fostering sustainable economic growth.

The government defines windfall revenue as tax receipts surpassing their long-term trend due to structural economic factors.