Obscuring the government’s fiscal spending timeline is the legislative delay for accompanying bills -- worth 4.7 trillion won in total. The currently pending bills include a special accounting act to execute the government’s 2.1 trillion won budget to enhance the competitiveness of domestic industries in light of Japan’s curbs on Korea’s key export items.

“In principle, (the ministry) will start (its budget allocation plan) once the National Assembly confirms it,” said Kim Myung-joong, the Finance Ministry’s chief budget officer, in a press briefing.

Though a number of accompanying bills are still pending, it is legitimate for the ministry to move on to the detailed allocation for next year’s fiscal spending, the official noted.

Asia’s fourth-largest economy is expected to expand 2.4 percent next year, up slightly from this year’s estimated 2 percent growth, on the back of the global economic uptrend and recovery of the memory chip market. The latest “phase one” trade deal between the US and China is also likely to serve as positive variable, according to the ministry.

The Cabinet also approved a series of tax benefits to encourage consumption.

One of the measures was to lower the consumption tax rate by 70 percent for those who scrap vehicles aged 10 years or more. The temporary tax cut for all-electric and hydrogen fuel cell electric cars will be extended to 2022.

While large companies will see their tax deduction rate for facility spending raised to 2 percent from 1 percent, the corresponding rate for small and medium-sized firms will be increased to 10 percent, the ministry said.

By Bae Hyun-jung (tellme@heraldcorp.com)