Special Report: Taiwan passes scaled-back defence spending bill

Taiwan's new USD24.8 billion supplementary budget bill falls short of the USD40 billion proposed by the government in November 2025 but stills provide a substantial increase to near-term defence funding. (Janes Defence Budgets)

Taiwan's Legislative Yuan passed on 8 May a ‘special defence budget', authorised through a supplementary budget bill, allocating TWD780 billion (USD24.8 billion) to fund the procurement of US military equipment between 2026 and 2033.

The newly approved funding falls short of the government's proposed TWD1.25 trillion (USD40 billion) unveiled in November 2025.

State-owned Central News Agency (CNA) reported that the bill allocates TWD300 billion for US military sales approved in December 2025, with a further TWD480 billion for a future package expected from Washington.

Both funding packages will require legislative review once Taiwan receives letters of offer and acceptance (LoAs) from the US for specific weapons systems, CNA reported. It added that the funding in both provisions would be drawn down annually, with each year's budget and implementation schedule subject to Legislative Yuan approval.

Taiwan's Ministry of National Defense (MND) announced in March that the legislature had authorised the signing of LoAs for four weapons systems that formed part of the US Foreign Military Sales (FMS) tranche announced by the US in December 2025.

The package approved by the US comprised High Mobility Artillery Rocket Systems (HIMARSs), M109A7 self-propelled howitzers, TOW 2B missiles, Altius-700M and -600 unmanned aerial vehicles (UAVs), and Javelin anti-armour missiles.

Under the December FMS notifications, valued at USD11.15 billion, Taiwan requested to procure 82 HIMARSs, 60 M109A7 155 mm self-propelled howitzers, and 1,050 Javelin FGM-148F missiles.