South Korea hikes corporate and education tax to fund $495B budget for 2026



Briefings South Korea hikes corporate and education tax to fund $495B budget for 2026 Bipartisan deal forces private sector to underwrite Lee Jae-myung’s National Growth Fund while opposition folds on taxes KOREA PRODecember 3, 2025 SHARE COPY LINK FACEBOOK X LINKEDIN MASTODON A collage of the ruling Democratic Party’s Supreme Council meeting, ROK President Lee Jae-myung’s budget speech to the National Assembly floor and the main opposition People Power Party protesting the prosecution’s decision not to appeal the Daejang-dong land development scandal case \| Image: Democratic Party of Korea (Nov. 5, 2025), ROK Presidential Office (Nov. 4, 2025), People Power Party (Nov. 17, 2025), edited by Korea Pro The ruling Democratic Party (DP) and the main opposition People Power Party (PPP) agreed Tuesday to pass the 2026 budget of approximately $495.8 billion (728 trillion won) by the legal deadline, marking the first on-time passage since 2020. The deal secures the launch of President Lee Jae-myung’s signature “National Growth Fund” — a $102.1 billion (150 trillion won) industrial policy vehicle designed to inject public and private capital into the artificial intelligence (AI), semiconductor and bio-health sectors over the next five years. However, the agreement comes at the corporate sector’s expense. To preserve the headline expenditure cap, the © Korea Risk Group. All rights reserved. No part of this content may be reproduced, distributed, or used for commercial purposes without prior written permission from Korea Risk Group. LATEST ANALYSIS 01South Korea’s CPTPP push exposes the cost of turning trade gains into consensus 02AI storage boom gives South Korea battery makers an EV overcapacity lifeline 03South Korea’s Mexico strategy runs into the hard limits of USMCA politics 04Preschool test ban forces South Korea’s English hagwons to rethink placement 05Lee Jae Myung’s Wall Street pitch tests South Korea’s capital market credibility 06US midterm clock raises stakes for South Korea’s $200 billion investment talks 07Lee’s Hormuz red line tests South Korea’s leverage in $350 billion US talks 08South Korea’s AI data center boom is colliding with the true cost of power

Briefings

South Korea hikes corporate and education tax to fund $495B budget for 2026

Bipartisan deal forces private sector to underwrite Lee Jae-myung’s National Growth Fund while opposition folds on taxes

KOREA PRODecember 3, 2025

South Korea hikes corporate and education tax to fund $495B budget for 2026

A collage of the ruling Democratic Party’s Supreme Council meeting, ROK President Lee Jae-myung’s budget speech to the National Assembly floor and the main opposition People Power Party protesting the prosecution’s decision not to appeal the Daejang-dong land development scandal case | Image: Democratic Party of Korea (Nov. 5, 2025), ROK Presidential Office (Nov. 4, 2025), People Power Party (Nov. 17, 2025), edited by Korea Pro

The ruling Democratic Party (DP) and the main opposition People Power Party (PPP) agreed Tuesday to pass the 2026 budget of approximately $495.8 billion (728 trillion won) by the legal deadline, marking the first on-time passage since 2020. The deal secures the launch of President Lee Jae-myung’s signature “National Growth Fund” — a $102.1 billion (150 trillion won) industrial policy vehicle designed to inject public and private capital into the artificial intelligence (AI), semiconductor and bio-health sectors over the next five years.

However, the agreement comes at the corporate sector’s expense. To preserve the headline expenditure cap, the

South Korea hikes corporate and education tax to fund $495B budget for 2026

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