South Korea to channel AI chip tax windfall into public investment and equality

South Korea plans to create a new fund using additional tax revenues from its booming AI chip industry to finance large-scale projects and address growing economic inequality, presidential chief of staff Kang Hoon-sik announced on Sunday Source: euronewses. The so-called 'future response fund' will support projects in semiconductors and AI, as well as housing, startups, and employment for young people Source: infobae.

Background of the chip boom

The windfall stems from record profits at Samsung Electronics and SK hynix, whose memory chips are essential for AI data centers. Samsung shares surged over 170% in the first half of 2026, while SK hynix shares rose more than 300% Source: euronewses. The companies plan a large public-private investment of 800 trillion won ($457 billion) for a new chip manufacturing hub Source: euronewses.

Political context

The fund's purpose was first floated in May by policy chief Kim Yong-beom, sparking controversy over redistribution of corporate profits Source: infobae. President Lee Jae-myung later denied that the fund would involve direct cash handouts. The government will discuss fiscal strategy this month before seeking public consultation Source: euronewses.

Key points:

• The fund aims to combat the 'K-shaped' economic polarization where high-tech sectors thrive while others lag Source: infobae.