Taiwan administration plans to include in the budget for 2027 235.7 billion new Taiwan dollars, or about $7.4 billion, for one-time payments to the population. Each recipient should receive 10,000 Taiwan dollars, or about $314, the head of the island's administration, Lai Tsinde, said.
Lai called these payments an opportunity to share the "dividends from artificial intelligence" with the population. At the same time, it is not about dividends from companies or a special tax on AI, but about a budget payment, which the authorities associate with a sharp acceleration of the economy thanks to the demand for semiconductors, computer equipment and other products for artificial intelligence.
It is important that for now it is a proposal in the draft central budget for 2027, and not about a payment finally approved by the parliament. Lai announced this on August 17 after the review of the draft budget by the executive power. The plan involves increasing spending by NT$235.7 billion while maintaining a balanced budget and, according to the head of the administration, with virtually no new net borrowing.
Taiwan's strong financial indicators allow the authorities to take such a step. The central budget revenue forecast for 2027 was raised to NT$3.9266 trillion.
The technological boom was the main reason for the increase in budgetary possibilities. According to data from Taiwan's General Bureau of Budget, Accounting and Statistics (DGBAS) released on August 14, 2026, the island's GDP grew by 15.43% year-on-year in the first quarter and 12.93% in the second. The economy grew by approximately 14.15% in the first half of the year.
The agency raised Taiwan's GDP growth forecast for the whole of 2026 from 9.64% to 11.05%. If the forecast comes true, it would be the highest annual growth rate since 1987, when the economy grew by 12.75%. By 2027, DGBAS expects growth to slow to 6.04%.
The main driver of the economy remains global demand for artificial intelligence infrastructure. DGBAS expects Taiwan's real exports of goods and services to increase by 21.28% in 2026, and private fixed capital investment by 11.58%. Manufacturing output rose 18.27% in the second quarter, driven primarily by semiconductors, computers, electronics and optical products.
Taiwan is a key player in the global supply chain for cutting-edge semiconductors. High demand for artificial intelligence equipment and investment from the world's largest technology companies has led to a sharp increase in production and exports of Taiwan's electronics industry.
The authorities expect the direct payments to spread the effects of the technology boom to households and industries not directly related to semiconductor and AI production. Recipients will be able to use the money independently — for daily expenses, education, care for elderly relatives or other purposes.
Taiwan de facto has its own administration, armed forces, currency and conducts internal and economic policy independently, but its international legal status remains controversial.
The People's Republic of China does not recognize Taiwan as a separate island state and considers it part of China's territory. Beijing adheres to the principle of "one China" and requires states that establish diplomatic relations with the People's Republic of China not to have official diplomatic relations with the authorities of Taiwan. According to the Ministry of Foreign Affairs of the People's Republic of China, 183 countries have established diplomatic relations with Beijing.
Therefore, most countries in the world do not have official diplomatic relations with Taiwan, although many maintain close unofficial economic, trade, cultural and political ties with it through embassies.
As of August 2026, Taiwan has official diplomatic relations with only 12 countries and the Holy See, including: Belize, Guatemala, Haiti, Paraguay, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Marshall Islands, Palau, Tuvalu, Eswatini and the Holy See. This list is provided by the Ministry of Foreign Affairs of Taiwan.
At the same time, the lack of official diplomatic recognition does not prevent Taiwan from remaining one of the most important technological economies in the world and one of the key links of the global semiconductor industry.
