The Democratic Party of Korea, the government, and the presidential office have agreed to establish a “Future Response Fund,” financed by the additional tax revenue generated from the semiconductor boom. This fund will be intensively deployed to secure future growth engines and combat economic polarization. The three parties also agreed to mobilize all national capabilities for the so-called “Three Mega Projects”: building AI data centers, fostering next-generation semiconductors, and creating a corporate-style advanced city.
At a high-level party-government consultation meeting held on the 5th at the Prime Minister’s official residence in Samcheong-dong, Seoul, participants discussed as a key agenda item the plan to utilize the additional tax revenue from the semiconductor industry boom as investment capital for future generations. Kang Jun-hyun, chief spokesperson for the Democratic Party, formalized the push to establish the Future Response Fund during a briefing immediately after the meeting, stating, “The party concurred with the government’s position to use the additional tax revenue for future growth engines and addressing polarization.”
Kang Hoon-sik, Chief of Staff to the President, also stated, “The Lee Jae-myung administration will not waste the additional tax revenue generated by the semiconductor boom but will push to establish a Future Response Fund to utilize it as financial resources for future generations.” However, the meeting did not finalize the specific scale of the fund’s resources, its operational methods, or a detailed roadmap. Chief Spokesperson Kang explained, “The government only presented the purpose and direction; specific plans were not discussed,” adding, “The details will be fleshed out at the level of the party’s policy committee and standing committees going forward.”
Regarding the fund’s name, the party, government, and presidential office agreed to use the official term “additional tax revenue” to avoid any misunderstanding that the term “excess tax revenue” might cause. Chief Spokesperson Kang conveyed, “I understand that the Ministry of Planning and Budget determined the term ‘additional’ to be more accurate.”
During the meeting, the three parties also agreed to concentrate national capabilities on promoting the “Three Mega Projects” alongside the establishment of the Future Response Fund. These projects are broadly divided into three pillars.
First, with the goal of realizing an “irreplaceable K-semiconductor powerhouse,” all efforts will be focused on securing an unassailable competitive edge in the memory sector. This involves pushing for the early completion of major semiconductor production hubs and their nationwide expansion, while simultaneously accelerating investment to preempt the next-generation semiconductor market.
Second, full support will be provided for the construction of AI data centers. The party, government, and presidential office agreed to spare no administrative support for power, land, and permits to ensure AI data centers are built without a hitch. Power infrastructure will be preemptively expanded in preparation for massive electricity demand, and a multi-source water supply system will be established for stable water provision. The plan also includes fostering AI data centers and physical AI as unrivaled export industries.
Third, a corporate-style advanced city integrating production, R&D, residential, cultural, educational, and medical functions will be developed in South Korea’s southwestern region to nurture it as a second semiconductor production hub. This is a vision to link corporate semiconductor investment plans in the region with local growth.
To ensure the smooth progress of these projects, the party decided to launch a “Three Mega Projects Support Task Force (TF)” and actively back follow-up measures, including the passage of related legislation. The government responded by pledging that relevant ministries, local governments, and the National Assembly would act as “one team” to support companies’ large-scale investments in a timely manner.
Meanwhile, regarding the direction of state affairs for the second half of the year, the party and government agreed to concentrate their capabilities on stabilizing the public’s perceived economy, including price stability and employment improvement. Key pillars for the second half include revitalizing investment and exports, establishing a foundation for locally-led growth through a national land transformation project, and supporting the growth and independence of young people.
In particular, ahead of the regular National Assembly session in September, the party and government agreed to select and intensively manage priority bills for the third quarter to expedite the processing of economic and public welfare legislation. Chief Spokesperson Kang emphasized, “There are currently over 200 bills pending in the plenary session, the Legislation and Judiciary Committee, and standing committees,” adding, “We will complete timely legislation before the regular session through step-by-step, customized legislative support, starting with the swift coordination of bills without inter-ministerial disagreements.”
This agreement is interpreted as reflecting a policy determination to convert the tax revenue increase from the arrival of a semiconductor boom into structural investments that strengthen the nation’s long-term competitiveness, rather than short-term fiscal spending or economic stimulus. However, given that the scale of additional tax revenue can fluctuate with economic cycles and the specific design of the fund has yet to be disclosed, detailed coordination over resource allocation and operational methods is expected to continue during future working-level discussions between the party and the government.