Executive Yuan Approves 2027 Overall Budget with NT$3.9 Trillion in Expenditures; Defense Budget Reaches 3.93% of GDP

The Executive Yuan's cabinet meeting today (20th) approved the 2027 (fiscal year 116) central government overall budget, with total expenditures set at NT$3.9266 trillion, an increase of NT$891.6 billion—or approximately 29.4%—from the 2026 (fiscal year 115) budget of NT$3.035 trillion. Notably, the overall defense budget reaches NT$1.1225 trillion, representing 3.93% of GDP when calculated using 2026's economic output.

According to the Directorate General of Budget, Accounting and Statistics (DGBAS), social welfare expenditures are the largest category, allocated NT$1.1889 trillion (30.3% of total expenditures), followed by economic development at NT$759.1 billion (19.3%), defense at NT$683.6 billion (17.4%), and education, science, and culture at NT$613.4 billion (15.6%).

Key policy initiatives include NT$182.3 billion for science and technology development, NT$22.2 billion for support measures for SMEs and micro-enterprises, NT$235.7 billion for universal cash disbursements, NT$39.2 billion for adjustments to military, civil servants, and educators’ compensation, NT$28.8 billion for cultural programs, NT$372.8 billion for education, NT$12.2 billion for sports, NT$57 billion for flood control, NT$379.4 billion for public construction projects, and NT$385.4 billion in central government subsidies to local governments.

The NT$1.1889 trillion in social welfare funding includes NT$329.5 billion for the new population strategy's family support component, NT$171 billion for elderly farmer allowances, National Pension, and six major social welfare subsidies, NT$130 billion to replenish the Labor Insurance fund, NT$60 billion for the National Health Insurance fund, and NT$10 billion for the Healthy Taiwan Deepening Initiative.

Regarding defense spending, the Ministry of National Defense's regular budget is NT$691.9 billion, an increase of NT$130.5 billion (23.2%) from the previous year. When including special budgets (NT$218.2 billion), non-operating special funds (NT$60.7 billion), veterans’ pension payments managed by the Veterans Affairs Council (NT$103.8 billion), and Coast Guard Administration expenditures (NT$47.9 billion)—calculated in line with NATO standards—the total defense-related spending reaches NT$1.1225 trillion. This represents 3.93% of GDP based on 2026 figures; if calculated against the projected 2027 GDP of NT$37.3 trillion, the ratio would be 3.01%.