South Korea to channel AI-driven tax windfalls into a new Future Fund
Seoul announced a Future Fund financed by excess tax revenue from the AI and chip boom, aiming to boost long-term growth.
South Korea's Ministry of Planning and Budget unveiled a plan to create a Future Fund using what it calls "windfall revenue" generated by higher tax collections amid the AI and global chip boom. Budget Minister Park Hong-geun explained that this revenue exceeds long-term trends and differs from ordinary surplus, prompting a proactive fiscal approach. The fund will serve as a strategic investment platform to raise the nation's potential growth rate, focusing on youth assistance, AI megaprojects and seven future-oriented sectors, including small modular reactors and advanced biology.
It will also help smooth fiscal volatility caused by fluctuating tax receipts. While the precise amount has not been disclosed, analysts estimate it could range from 60 to 70 trillion won, potentially reaching 100 trillion won. The proposal will be reviewed by the Cabinet on Sept. 1 and submitted to the National Assembly on Sept. 3.
Why it matters
The fund could reshape South Korea's fiscal policy and drive investment in emerging technologies.
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