July 7, 2026, the South Korean government announced plans to establish a "Future Response Fund" of up to 100 trillion won (approximately $65 billion) using additional tax revenues generated by the semiconductor industry boom, with collections expected to be completed by early 2027.
Three Key Areas
Presidential Chief of Staff Kang Hoon‑sik outlined the fund's three main investment directions: first, building economic growth engines by supporting semiconductors, AI data centers, and physical AI; second, easing K‑shaped polarization to address structural imbalances between the high‑tech sector and domestic manufacturing; and third, supporting young people aged 20–30 with housing, entrepreneurship, and employment assistance.
Kang stressed: "At this critical moment determining Korea's future, we must not squander the additional tax revenues from the semiconductor boom."
Linked to Three Mega‑Projects
The fund is closely tied to the three mega‑projects recently announced by the Lee Jae‑myung administration.
Samsung Electronics and SK Hynix will jointly invest 800 trillion won in wafer fabrication plants in the southwestern region, while Chungcheong Province will see 81 trillion won invested in chip packaging facilities. Total investment across the three projects exceeds 1,800 trillion won.
The projects will be concentrated outside the Seoul metropolitan area—in Gwangju, Daegu, and Chungcheong—to break the capital region's industrial monopoly and promote balanced regional growth.
Tax Dispute
Inside the Blue House, there had been disagreements over how to use the extra tax windfall, with some suggesting a "national dividend" cash payout and others advocating for debt repayment.
Estimates show that South Korea alone could generate 50 to 70 trillion won in fiscal surplus in 2026. Kang explicitly opposed direct handouts or debt repayment, arguing instead for long‑term national development.
Special Legislation to Proceed
The Blue House announced that the fund will be established through special legislation, with a blueprint for its use to be presented at an upcoming national fiscal strategy meeting, followed by detailed provisions in next year's budget proposal.
Risk Warning
Analysts point out that semiconductor tax revenues are highly dependent on memory prices and AI capex cycles. Should AI demand cool or chip prices reverse, the fund's revenue base could weaken. The key is to avoid repeating the memory industry's cycle of "heavy investment during booms and overcapacity during downturns."