Fuel taxes will be discounted by 20 percent for about six months from November 12 to the end of April next year. Gasoline prices will fall by 164 won per liter. As South Korea’s oil prices hit the highest level in seven years due to a surge in global oil prices, the government decided to reduce fuel taxes by the largest margin ever.
The South Korean government announced such a plan to address hikes in oil prices after a meeting of the central response center for economic emergency presided by Minister of Economy and Finance and Deputy Prime Minister Hong Nam-ki at Government Complex Seoul on Tuesday. The government decided to lower fuel taxes imposed on gasoline, diesel, LPG, and butane gas by 20 percent for six months. With the plan in place, the price of gasoline, diesel, and LPG and butane gas will be reduced by 164 won, 116 won, and 40 won, respectively.
“If fuel tax discount is wholly reflected on oil prices, the monthly price index will decrease by 0.33 percentage points,” said Hong. The measure will take effect on November 12 after the revision of a related enforcement decree and end at the end of April next year. If oil prices stabilize, it may end sooner than expected.
In order to reduce pressure on gas price increase, import tariffs on LNG will be reduced to zero percent during the same period from the current level of three percent or two percent from October to December. The government will freeze utility prices, including gas, until the end of the year.
Ae-Jin Ju email@example.com