South Korea Economics: Larger 2026 Excess Tax Revenue & Equity Market Stabilization Measures

On November 12, 2026, South Korea's Ministry of Planning and Budget released updated fiscal data. Driven by faster-than-expected revenue collection through September 2026, Citi raised its 2026 excess fiscal revenue estimate to approximately KRW88trn versus the government's KRW700.4trn budget plan, up from a prior KRW63.2trn estimate. The outperformance was broad-based, led by corporate taxes on the semiconductor upcycle, income taxes on higher performance bonuses and a housing market recovery, and VAT on import and private consumption growth. MoFE has already deployed KRW5trn of the excess revenue to reduce October KTB issuance, leaving roughly KRW83trn that could flow into the Future Response Fund in early 2027. Combined with an estimated KRW162trn 2027 windfall, the cumulative funding pool could rise by up to KRW245trn over 2026-2027, with the average investable balance reaching at least KRW120trn in 2027. The MPB confirmed it will manage the fund's idle balance via Outsourced Chief