Due to Revenue Decline... Yongin-si's Next Year's 'Austerity Budget' Formulated

3.2377 Trillion Won... Only a 0.7% Increase YoY
Impact of Decreased Real Estate Tax Revenue and Income Tax from Samsung Electronics, etc.

Yongin City in Gyeonggi Province has embarked on a tight fiscal policy that effectively freezes next year's budget.

On the 21st, Yongin City announced that it submitted the 2024 main budget proposal to the city council, totaling 3.2377 trillion won, an increase of 0.7% (23.1 billion won) compared to this year.

The city explained, "Due to a decline in publicly announced land prices and a decrease in real estate-related tax revenue, as well as an expected reduction in taxes paid by companies due to the economic slowdown, we have prepared a budget at a freeze level."

In fact, the cumulative operating profit of Samsung Electronics, the largest company in the jurisdiction, up to the third quarter of this year is 3.7422 trillion won, which is less than 10% of the same period last year (39.0704 trillion won).

Given the persistent inflationary pressures and the sharp decline in global demand due to US-China conflicts, the domestic and international economic situation remains uncertain. Therefore, the city plans to reexamine unnecessary projects from scratch and prioritize investment projects by reviewing their urgency and validity to maximize fiscal efficiency.

Accordingly, the city has prepared a tight budget, including a 10% cut in business promotion expenses related to agency operations. However, the city added that it will actively support expenditures related to welfare, safety, and projects addressing low birth rates and aging populations for youth and vulnerable groups, focusing on necessary investments for the future.

Next year's main budget by account includes 2.8107 trillion won for the general account, an increase of 4.9 billion won compared to this year. The special account is 427 billion won, up 18.1 billion won from this year.

The main revenue sources for the general account are ▲local taxes 1.1695 trillion won ▲non-tax revenue 228.3 billion won ▲local allocation tax and adjustment grants 250.7 billion won ▲national and provincial subsidies 999 billion won ▲compensation income and internal transactions 171.2 billion won, among others.

Looking at the expenditure budget by sector, 28.9 billion won was allocated to public order and safety, an increase of 46.3%, and 105.3 billion won was allocated to culture and tourism, up 22.8%. The welfare budget, which surpassed 1 trillion won for the first time based on this year's main budget, was also increased by 7.61% to 1.1161 trillion won.

On the other hand, the general public administration sector decreased by 43.8 billion won (20.1%), and the agriculture, forestry, marine, and fisheries sector decreased by 27.2 billion won (28.6%) according to the budget input plans for each project phase.

Meanwhile, the budget proposal stands out for allocating 14 billion won to create public parking lots under parks in three areas?Yeokbuk District, Anmaeul, and Towol?to expand transportation infrastructure and alleviate parking difficulties.

The city also allocated 124.9 billion won for road construction, expansion, and maintenance in Cheoin-gu, which accounts for about 79% of Yongin's area. Additionally, 46 billion won will be invested in road construction and maintenance in Giheung-gu, and 20.7 billion won in Suji-gu, with plans to carry out tunnel facility and underground road flood damage prevention projects.

Yongin City's budget proposal for next year is expected to be finalized on the 15th of next month after deliberation by the city council.

Mayor Lee Sang-il of Yongin said, "The next year's budget proposal was prepared with a focus on selection and concentration, considering the decrease in local tax revenue while increasing investments for the future and support for those in need. We focused on areas requiring bold investment, those necessary for balanced development of the city, and consideration for vulnerable groups."