Taiwan President Lai Ching-te pointed out today (August 17) that in the 116th (2027) central government budget, under the premise of balancing income and expenditure, and achieving real zero borrowing, an additional 235.7 billion New Taiwan Dollars (NTD) will be allocated for expenditures, aiming to distribute 10,000 NTD in cash to every individual for them to share. At the same time, the overall defense budget for next year will surpass 1 trillion NTD for the first time, reaching 1.1225 trillion NTD.
President Lai Ching-te listened to a briefing on the “116th Central Government Budget” by the Executive Yuan this morning, stating that the government will continue to promote five important missions for next year: “New Family Support Strategy for Taiwan’s Population” and “Strengthening Defense Forces”, building “Smart Nation 2.0”, accelerating the implementation of public infrastructure to ensure balanced development across Taiwan, and expanding support to local areas. The goal is to take care of every hardworking Taiwanese individual and allow everyone to share in the economic growth.
Lai Ching-te mentioned that the latest economic figures released by the Directorate General of Budget, Accounting and Statistics (DGBAS) showed a strong economic performance in Taiwan, with the economic growth rate for the first quarter of this year revised from 14.55% to 15.43%, and the preliminary statistics for the second quarter reaching 12.93%. Taiwan’s economy has seen double-digit growth for three consecutive quarters.
He stated that the economic growth rate for the first half of this year reached 14.15%, the strongest performance for the same period in half a century. The projected economic growth rate for the whole year has been revised from the initial 9.64% to 11.05%, potentially setting a new record in 39 years. These impressive figures reflect the collective efforts of the Taiwanese people.
President Lai expressed gratitude to all businesses and hardworking laborers, as well as the executive team led by Premier Cho Rong-tai, for their dedication and achievements amid international economic and political challenges. He emphasized that the strong economic growth in Taiwan is driven by the increasing global demand for AI, high-performance computing, and cloud services, leveraging Taiwan’s advantages in semiconductor, information and communication technologies, and manufacturing supply chains.
Lai highlighted the need to address the uneven distribution of economic growth, emphasizing that while Taiwan’s tech industry is thriving, there are many individuals working diligently in service, traditional industries, small and medium-sized enterprises, and frontline positions. The government must not only focus on average figures but also ensure support for those below the average, promoting inclusive growth and supporting families striving for a better life.
With the upward revision of economic growth, the central government’s total revenue for the 116th fiscal year has also been raised to 3.9266 trillion NTD. Therefore, the government has decided to add 235.7 billion NTD to expenditures for next year to distribute cash directly to citizens, allowing for shared benefits of the “AI dividend”.
President Lai stressed that despite the cash distribution, the total budget for next year remains balanced without additional debt. The government aims to address immediate needs while ensuring accountability to future generations, sharing the fruits of economic growth while maintaining fiscal discipline.
In addition to the cash distribution, the government will continue to promote salary increases, tax cuts, enhanced welfare, reduced burdens, and infrastructure development for next year. Five key missions included in the upcoming budget are:
Firstly, promoting the “New Family Support Strategy for Taiwan’s Population”.
With a total budget of 373 billion NTD, programs like the “Financial Support for 0-18-Year-Olds” included in the budget aim to support families directly without the need for legislation. Policies such as the 6+3 childcare leave subsidy, extended marriage and maternity leaves have also been budgeted for next year. Through comprehensive support for child-rearing, daycare, enhanced education, friendly workplaces, and stress-free living, Taiwan will shift from “subsidized parenting” to “publicly supported parenting”.
Secondly, strengthening defense forces to safeguard national security.
The overall defense budget for next year, including annual and special budgets, will exceed a trillion NTD, reaching 1.1225 trillion NTD, maintaining over 3% of GDP to demonstrate Taiwan’s commitment to enhancing self-defense. Investing in defense is investing in peace, and the government will continue to build a stronger defense force to maintain peace and stability in the Taiwan Strait and the region.
Thirdly, creating “Smart Nation 2.0” to drive the transformation of small and medium-sized enterprises.
Next year’s technology development plan totals 229.2 billion NTD, with a 12.7% increase from this year. The allocation of 40.6 billion NTD for the “Top Ten AI Projects” will focus on research, computing power, talent, and key technologies to solidify Taiwan’s technological advantages, secure a crucial position in the global AI supply chain, and seize opportunities for industry development and economic growth.
The government will also implement legislative amendments to increase funding by 100 billion NTD over the next eight years, supporting small and medium-sized enterprises to enhance worker salaries and drive transformation and upgrades.
Fourthly, accelerating public infrastructure development to achieve balanced development in Taiwan.
The overall budget for public construction next year amounts to 728.8 billion NTD, with 147.2 billion NTD allocated for the Balanced Taiwan Plan. Visible infrastructure like railways, community roads, and invisible projects such as sewage systems will receive increased funding, focusing on water management, resilience, and promoting industry and job opportunities in various regions to achieve the goal of balanced development in Taiwan.
Fifthly, expanding support for local areas through central-local cooperation for a better life in Taiwan.
The central government’s allocation for local finances next year, including distributed tax revenues and general and program-specific subsidies, will reach 1.3579 trillion NTD, an increase of 192.9 billion NTD from this year. Central and local governments will collaborate to empower local governments for infrastructure development, economic growth, and improved livelihoods to continue building a better life in Taiwan.
President Lai emphasized that from the approximately 1.9 trillion NTD in central government expenditures in 2016 to the 3.9266 trillion NTD budgeted for next year, Taiwan’s national strength has doubled over the past decade. The increased national strength must manifest in national security, competitiveness, and the progress of people’s lives. He urged the executive team to finalize the budget according to schedule and hoped the legislature could review next year’s budget as planned.
He concluded by stating, “As we share the fruits of growth, Taiwanese people unite together; we work towards the future of our country. We will continue to seize the historic opportunities brought by AI, strengthen and invest in Taiwan, and take care of every hardworking Taiwanese individual. Let technology drive the economy, make the economy strengthen the nation, and let the progress of the country return to the daily lives of the people. Let’s work hard together.”