• Taiwan's defense budget for 2026 is set to exceed 3% of GDP for the first time since 2009.
• The budget includes significant allocations for coast guard services, reflecting rising threats from China.
• Pressure from the US government has encouraged Taiwan to increase its military expenditures.

Taiwan plans to increase its defense spending to T$949.5 billion (approximately $31.27 billion) for 2026, reaching 3.32% of its gross domestic product. This marks the first time the country has surpassed the 3% threshold since 2009, underlining the government's response to increasing military pressure from China and calls from the United States for enhanced defense expenditure. Premier Cho Jung-tai described this move as "another concrete demonstration to the world and our people" of Taiwan's commitment to national security, which reflects a broader strategy to modernize its military capabilities, including funding for new fighter jets and naval defenses, according to Reuters, Reuters, and Channel News Asia.

The government's determination to bolster its military budget aligns with the US’s ongoing pressure on its allies to increase defense spending, especially in light of China's recent military activities and claims over Taiwan. This proposed budget will also include funding for the coast guard for the first time, demonstrating the nation's comprehensive approach to national security, which utilizes a "NATO model". This was emphasized by officials who noted the coast guard's role in regular stand-offs with Chinese forces, according to Reuters, Channel News Asia, and AA.

President Lai Ching-te has indicated that he hopes defense spending may increase to 5% of GDP by 2030, signaling a long-term commitment to military expansion in response to perceived threats from China. During his recent remarks, he reiterated that the budget reflects Taiwan's resolve to defend its sovereignty and contribute to regional stability in the Indo-Pacific. Lai's administration is expected to face scrutiny in the Legislative Yuan, where opposition lawmakers may challenge the budget allocation, a sentiment echoed in the government's historical context of necessary funding adjustments for defense, according to Channel News Asia and AA.