The deficit in South Korea’s consolidated fiscal balance hit to an all-time high of 22.3 trillion won ($18.67 billion) by August this year amid slow tax revenue from economic downturn despite supersized budgeting for two years in a row.

The red in fiscal balance is the highest since consolidated data was compiled from 2000. Korea recorded January-August deficits in fiscal account only in 2009, 2014 and 2015.

According to the finance ministry’s monthly fiscal report for October, tax income as of August was 326.6 trillion won, off 500 billion won from a year ago. National tax revenue was reduced by 3.7 trillion won from last year to 209.5 trillion won, the first drop since 2014. The ministry attributed to a 2.5 trillion won drop in value-added tax revenue caused by a hike in rural consumption tax rate from 11 percent to 15 percent.

The country’s fiscal deficit has stretched by a yawning pace from March amid fiscal expansion to fight unemployment and fuel Asia’s fourth largest economy. The management budget balance, which excludes the four major national funds such as pensions and employment insurance, posted a deficit of 49.5 trillion won.

Tax collection reached 71.1 percent of annual target as of August, 1.5 percentage point slower compared with a year ago.

Non-tax revenue came to 16.8 trillion won, down by 1.6 trillion won from a year ago. Fund revenue was up by 4.8 trillion won to 100.2 trillion won. Cumulative expenditure was 348.9 trillion won, up by 37.8 trillion won from the same period a year ago.

The country’s national debt totaled 697.9 trillion won as of end-August, up 5 trillion won. Fiscal spending totaled 225.8 trillion won as of August, up by 13 trillion won compared with the same period last year.

By Sohn Il-seon and Minu Kim

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