Korea's National Assembly passed a bill on supporting people's livelihood by cutting consumer fuel tax and reducing meal payment burdens.
The National Assembly's Special Committee on People's Livelihood and Economic Stability convened a general meeting on Friday and passed a revised bill on transport, energy and environment taxes that expands the fuel tax cut limits by as much as 50 percent from the current 30 percent and another partially-revised bill on individual consumption taxes. The Korean government already increased the fuel tax cut limits by 37 percent starting from July via its enforcement ordinance. This time, the lawmakers bipartisanly agreed that further fuel tax cuts were necessary to stabilize consumer prices. Upon the request by the government, the National Assembly decided to include an additional clause stating that "after the revision, the tax rate may be adjusted considering a variety of factors such as international oil prices, inflation and impact on national fiscal status." The revised bill remains effective until the end of 2024.
The committee also approved a revised bill on income tax that raises the tax exemption limit for workers' meal payments from 100,000 won per month to 200,000 won. The non-taxable limit had been frozen for the past 19 years since 2003, however, the bill was passed as it seemed necessary to offer more benefits to workers struggling with the recent skyrocketing consumer prices. The revised income tax bill takes effect from Jan. 1, 2023.
The bills approved by the Special Committee will be processed in the plenary session scheduled on Tuesday after passing through the Legislation and Judiciary Committee Monday.