Manila:South Korea logged its smallest fiscal deficit through August in eight years, driven by strong tax revenue growth from higher incomes and increased home transactions, the budget ministry announced.

According to Yonhap News Agency, the managed fiscal balance, a key measure of fiscal health calculated under stricter criteria, recorded a deficit of 43 trillion won (US$32 billion) as of the end of August. This marks an improvement of 45.3 trillion won compared to the same period in 2025.

The end-August deficit is the lowest since a fiscal shortfall of 12 trillion won was recorded during the same period in 2018. Tax revenue reached 329.9 trillion won from January to August, up 69.1 trillion won from the previous year.

Corporate tax revenue increased by 28.2 trillion won due to strong earnings by domestic companies, while income tax revenue rose by 14.4 trillion won, boosted by bonuses paid by companies and a rise in home transactions. Additionally, securities transaction tax revenue increased by 7 trillion won amidst higher market trading volumes.

Non-tax revenue and fund revenue also saw increases of 9.2 trillion won and 32 trillion won, respectively, from the previous year. Meanwhile, total government expenditures amounted to 524.7 trillion won during the eight-month period, which is an increase of 39.3 trillion won from a year earlier.

As of the end of August, the central government's outstanding debt was 1,372.1 trillion won, an increase of 17.9 trillion won from the previous month.