Deficit of 45.6 Trillion Won in Managed Fiscal Balance from January to November Last Year... 3.3 Trillion Won Less National Tax Collected

[Asia Economy Reporter Kwangho Lee] Due to the government's expansionary fiscal policy, the managed fiscal balance recorded a deficit of 45.6 trillion won from January to November last year, breaking the record for the largest deficit since the related statistics were first published in 2011. During the same period, national tax revenue was 3.3 trillion won less than the previous year. Central government debt exceeded 700 trillion won.

According to the "Monthly Fiscal Trends January Issue" published by the Ministry of Economy and Finance on the 8th, the managed fiscal balance showed a deficit of 200 billion won in November last year, resulting in a cumulative managed fiscal deficit of 45.6 trillion won.

The managed fiscal balance is the figure obtained by excluding the four major social security funds from the integrated fiscal balance (government total revenue minus total expenditure), and it indicates the government's net fiscal situation.

The integrated fiscal balance from January to November last year was recorded as a deficit of 7.9 trillion won.

The government, deciding to pursue an active fiscal policy, initially set the managed fiscal balance deficit at 37.6 trillion won (1.9% of Gross Domestic Product (GDP)) in last year's budget. Later, when submitting the supplementary budget, the managed fiscal balance deficit forecast was revised to 42.3 trillion won (2.2% of GDP), while the integrated fiscal balance was changed to a surplus of 1 trillion won.

The government explained, "The fiscal deficit peaked in the second quarter due to early and active fiscal spending in the first half, and since the third quarter, the scale of expenditure has gradually decreased relative to revenue, leading to a trend of shrinking deficits."

Among total revenue from January to November last year, national tax revenue was 276.6 trillion won, down 3.3 trillion won compared to the same period the previous year.

As last year's tax revenue is likely to fall short of the government's tax revenue budget (294.8 trillion won), a tax revenue shortfall compared to the budget is expected to occur for the first time in five years since 2014.

Income tax revenue in November was 10.9 trillion won, increasing by 1 trillion won compared to the same period last year due to an increase in interim payments of comprehensive income tax and a rise in earned income tax from nominal wage growth.

However, value-added tax revenue was -1.1 trillion won, decreasing by 1.8 trillion won compared to the same period last year due to a decline in import volume and an increase in refund payments in November compared to the previous year.

The progress rate of national tax revenue until November was 93.8%, slightly down from 95.3% in the same period last year.

Total revenue, including non-tax revenue and fund revenue, was recorded at 435.4 trillion won. Total expenditure during the same period was 443.3 trillion won.

The government forecasted, "In December, an increase in tax revenue compared to the previous year is expected, mainly from major tax items such as income tax and comprehensive real estate holding tax, and the annual tax revenue is expected to be at the budgeted revenue level."

Central government national debt increased by 6 trillion won from the previous month due to treasury bonds (5.8 trillion won) and national housing bonds (100 billion won), reaching a total of 704.5 trillion won.

The government anticipated, "Considering that regular repayments are planned for December, the debt scale will converge within the government's planned range or may be slightly reduced compared to the plan."

This content was produced with the assistance of AI translation services.