❑ NABO’s Medium-Term Fiscal Projection Results: 2024-2033
   ◦ The projections incorporate the key policy changes outlined in the government’s 2025 Budget Bill and National Fiscal Management Plan.
    － Total revenue is projected to increase at an annual average growth rate of 4.7%, from KRW 590.6 trillion in 2024 to KRW 891.9 trillion in 2033.
    － Total expenditure is projected to increase at an annual average growth rate of 4.7%, from KRW 634.8 trillion in 2024 to KRW 956.6 trillion in 2033.
    － The managed fiscal balance* as a percentage of GDP is projected to improve from -3.8% in 2024 to -2.2% in 2033.
    － National debt is expected to grow at a CAGR of 6.6%, from KRW 1,177.1 trillion (46.2% of GDP) in 2024 to KRW 2,087.5 trillion (57.7%) in 2033.
   ◦ According to NABO’s medium-term fiscal projections, the managed fiscal balance as a percentage of GDP is expected to remain under -3% after 2029.
    * The managed fiscal balance refers to the consolidated fiscal balance that excludes social security funds balance.

❑ Fiscal Impact Analysis of the 2025 Budget Bill and Related Proposals
   ◦ The major policy changes outlined in the government’s 2025 Budget Bill and other proposals are projected to result in a decrease of KRW 33.4 trillion in national tax revenue over a decade, while mandatory expenditure is expected to increase by KRW 13.0 trillion during the same period.
    － National tax revenue is projected to fall below the baseline projection* due to the impact of the government’s Tax Law Amendment Bill. This difference from the baseline projection is primarily due to an increase in the child deduction for inheritance tax and an expansion of the child tax credit for income tax.
    － Mandatory expenditure is projected to exceed the baseline projection due to policy changes in the government’s proposals, including the 2025 Budget Bill. The major contributing factors include the expansion of maternity protection and childcare support programs (employment insurance), a freeze on health insurance premium rates (health insurance and long-term care insurance for the elderly), and the broadening of basic livelihood guarantee benefits (livelihood benefits and housing benefits).
     * Baseline projection: A projection that does not account for major policy changes outlined in the government’s 2025 Budget Bill or related proposals.

❑ Comparison with the Government's National Fiscal Management Plan
   ◦ The size of the managed fiscal balance in the government’s National Fiscal Management Plan is less than NABO’s projection, and the National debt ratio is 1.9%p lower as of 2028.
    － NABO projects that total revenue will be KRW 48.0 trillion lower and total expenditure will be KRW 20.8 trillion higher than the government’s forecast over the five-year period from 2024 to 2028. These differences arise from variations in economic projections, such as macroeconomic variables and the modeling approach.