Tax Revenue Likely to Exceed Supplementary Budget Forecast by 16 Trillion Won Amid Semiconductor and Stock Market Boom

As the Semiconductor industry recovers and stock market trading volume rises, this year's national tax revenue is estimated to exceed the supplementary budget forecast by about 16 trillion won. Corporate tax, income tax and Securities Transaction Tax are all showing strong gains, adding upward pressure to tax revenue.
According to authorities on the 14th, cumulative national tax revenue from January to April this year came to 164.1 trillion won. That is up 21.9 trillion won, or 15.4%, from the same period last year.
If the same growth rate continues through year-end, annual national tax revenue would reach 431.5 trillion won, up 57.6 trillion won from last year's 373.9 trillion won. That would be 16.1 trillion won higher than the government's forecast of 415.4 trillion won in the supplementary budget passed on April 10.
Based on the average April tax collection progress rate of 38.6% over the past five years, this year's national tax revenue would be calculated at around 425.1 trillion won. Even in that case, it would still be about 9.7 trillion won above the supplementary budget forecast. Of course, actual revenue may differ because of variables such as VAT refunds and Interim corporate income tax prepayment.
The government believes upward pressure on tax revenue is strong. Corporate tax is the most notable source.
From January to April, corporate tax revenue totaled 39 trillion won. That is an increase of 3.2 trillion won, or 8.9%, from the same period last year. As earnings improvements continue at Semiconductor companies such as Samsung Electronics Co., Ltd. and SK hynix, corporate tax revenue in the second half of the year could also benefit. In particular, Interim corporate income tax prepayment is scheduled for August, which could further reflect improved corporate earnings in tax revenue.
Securities Transaction Tax is also performing more strongly than initially expected. Revenue from January to April stood at 4.1 trillion won. That is up 3.1 trillion won, or 290.9%, from a year earlier, the highest growth rate among all tax categories. Analysts say the sharp rise in trading volume amid greater stock market volatility, along with higher tax rates, drove the surge.
Last year, Securities Transaction Tax accounted for just 0.9% of annual national tax revenue. But on a cumulative basis for January to April this year, its share has risen to 2.5%. A small tax item that once accounted for less than 1% of national tax revenue has become significant enough to influence the size of the excess tax revenue this year.
Income tax is also seen as an upward factor. From January to April, income tax revenue reached 44.7 trillion won, up 5.9 trillion won, or 15.2%, from last year. The increase was driven by higher earned income tax from larger performance bonuses and by capital gains tax revenue from increased real estate transactions.
The government is expected to release a revised forecast for this year's national tax revenue around September, based on a new tax revenue estimate. If revenue exceeds the supplementary budget forecast by a wide margin, how to use the excess tax revenue is likely to become a key issue in fiscal management.