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Taiwan Sets 2026 Defense Outlay at 3.32% of GDP as Lai Targets 5% by 2030

The plan now goes to an opposition-led legislature for scrutiny.

A view of soldiers on top of M60A3 tanks during a drill rehearsal in New Taipei City, Taiwan July 20, 2023. REUTERS/Ann Wang/File Photo
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Taiwan's President Lai Ching-te, left, listens to a briefing about a T-BE5A Brave Eagle, Fifth-Generation Advanced Jet Trainer as he visits to inspect Taiwanese Air Force at a military base in Taitung County, eastern Taiwan, Tuesday, Jan. 21, 2025. (Chiang Ying-ying/AP)

Overview

  • Total defense-related spending is proposed at NT$949.5 billion for 2026, a NT$176.8 billion increase year on year, with the Ministry of National Defense’s core budget up 20.1% (+NT$93.8 billion).
  • The Cabinet introduced a NATO-style accounting method that includes Coast Guard and veterans’ expenditures in the headline total.
  • Special allocations of NT$117.6 billion are planned, including NT$7.6 billion for the Coast Guard, alongside Foreign Military Sales and homeland security resilience budgets.
  • Taipei plans higher payments for U.S. arms and greater readiness spending, with operational upkeep rising 34.82% to NT$199 billion and military investment reaching NT$161.6 billion.
  • President Lai pledged to raise defense spending to 5% of GDP by 2030, while the government seeks court review of a legislated military pay hike that was not funded in the 2026 proposal.