Inspection of the First Supplementary Budget Execution… Possibility of 30 Trillion Won for the Second Supplementary Budget
President Lee Jae-myung will chair the second emergency economic task force (TF) meeting at 10 a.m. on the 9th at the Yongsan Presidential Office.
This is the second meeting convened just five days after the first meeting held shortly after his inauguration on the 4th, indicating that the drafting of the second supplementary budget (supplementary budget) will be seriously discussed.
Key economic ministers and their working-level officials from the Ministry of Economy and Finance, Ministry of Trade, Industry and Energy, Ministry of Land, Infrastructure and Transport, Ministry of SMEs and Startups, and the Financial Services Commission will attend the meeting. Economic advisors will include Kim Yong-beom, head of the policy office, Ha Jun-kyung, chief economic advisor, and Ryu Deok-hyun, advisor for fiscal planning, from the presidential office.
At this second meeting, the status of execution for the first supplementary budget, which was set at 13.8 trillion won last month, will be inspected, and specific discussions will likely be held regarding the necessity and direction of the second supplementary budget.
The Ministry of Economy and Finance is expected to report on the scale of the second supplementary budget and ways to secure funding during this meeting.
Lee Jae-myung Orders 'Immediate Economic Stimulus' for the Supplementary Budget… Inclusion of Local Currency Expected
Earlier, on the 4th during the first emergency economic TF meeting, President Lee emphasized the effectiveness of the supplementary budget as a policy tool for responding to domestic economic conditions and livelihood crises after reviewing Korea-U.S. trade issues.
At that time, President Lee asked, "Is the fiscal capacity sufficient?" and "How much economic stimulation effect will the supplementary budget bring?" instructing the Ministry of Economy and Finance to actively manage fiscal operations and respond to risks.
In response, the Ministry of Economy and Finance has begun practical consultations among departments. Notably, since President Lee pledged a 'supplementary budget of over 30 trillion won' during his campaign, it is anticipated that direct support for livelihood recovery will be included in this second supplementary budget as well.
Lee Han-joo, Chairman of the National Planning Commission, recently stated in a media interview, "Local currency has a pain-relieving effect on the economy," and "a significant portion of the livelihood supplementary budget could be composed of local currency." Therefore, it is highly likely that the expanded issuance of local currency and recovery aid funds for low-income households will be included.
Correction of Tax Revenue Shortfalls Also Included… Review of Deficit Bond Issuance
It is expected that tax adjustments will also be included in this second supplementary budget proposal. With national tax revenues expected to be insufficient compared to the budget this year, the government is considering issuing deficit bonds to correct for tax revenue estimates.
Inside the government, there are opinions that tax corrections proportional to the shortfall size are necessary, and analysis suggests that approximately 8 trillion to 10 trillion won in tax adjustments will be included.
A presidential office official stated, "The pain of livelihoods due to domestic recession is growing," adding, "President Lee is making the recovery of people's livelihoods a top priority and is putting all efforts into emergency economic responses."
As a result of this meeting, the outline of the second supplementary budget is expected to be clarified soon.
Image source: News1
