Cabinet Formally Approves Record NT$1.1225 Trillion 2027 Defense Budget, First Time Above NT$1 Trillion

Taiwan's Executive Yuan (Cabinet) formally approved on August 20, 2026 a NT$3.9266 trillion (~US$123.1 billion) central government budget proposal for 2027 that includes NT$1.1225 trillion for national defense — the first year defense spending has surpassed NT$1 trillion, following President Lai Ching-te's August 17 announcement of the figure. The defense total breaks down into NT$691.9 billion for the Ministry of National Defense, NT$218.2 billion in special budgets and NT$60.7 billion in non-operating special funds, plus Veterans Affairs Council and Coast Guard Administration spending calculated under the NATO accounting method. Defense spending is set at 3.93% of GDP using the 2026 projection (3.01% using the 2027 projection), extending Taiwan's push toward Lai's target of 5% of GDP by 2030. The overall budget also achieves substantive zero net new borrowing for the first time in 78 years and includes a NT$235.7 billion universal cash handout and a 41.1% increase in social welfare spending to NT$1.1889 trillion. The budget now goes to the Legislative Yuan for review by the end of August.