Extending Subsidy to Cover Tax Rise on Gasoline is Under Consideration

As oil prices continue to rise, the government is considering extending a grant covering the increase in gasoline tax prices for buses, cabs, and freight cars. As of now, the government is scheduled to stop providing aid to these services in June.

Yesterday the Ministry of Construction & Transportation said that it has devised a comprehensive measure for improving the freight transportation industry which would include some government grants. Additionally, the Ministry is negotiating with other related government departments.

According to this measure, the government will continue offering aid for an additional year past the ensuing June. This measure will also establish another grant for the additional gasoline tax rise which is scheduled to take effect in July.

If this measure is passed, 470 billion won will be allocated to aid the transportation industry. Currently, the government is granting 100.24 won per for gasoline and 129.2 won for LPG (liquefied petroleum gas).

In order to establish reasonable freight rates, the Ministry is considering introducing a new freight rate system that will investigate and make public the price of major freight cars including container cars and bulk cement trailers (BCT).

The price will be determined by monitoring major sections such as Busan-Seoul and Busan-Gumi for container cars, and Jecheon-Seoul for BCT.

Seong-Yub Ra cpu@donga.com