Fuel Tax Cut Extended by Two Months... Gasoline at 15%, Diesel and LPG at 25%

[Financial News] The government has decided to extend its temporary fuel tax cut for another two months, through the end of September. The move is intended to respond to volatility in international oil prices, as instability in the Middle East has not yet been fully resolved, and to ease the burden of fuel costs on the public.
Deputy Prime Minister and Minister of Economy and Finance Koo Yun-cheol chaired a meeting of the Task Force of Related Ministers for Special Management of Consumer Prices on the 24th and announced the fuel tax policy, which includes the extension.
The government said it will keep the current fuel tax cut rates in place through Sept. 30, at 15% for gasoline and 25% for diesel and liquefied petroleum gas (LPG) butane. As a result, consumers will continue to feel the effect of the tax cut. Including value-added tax (VAT), the reduction per liter is 122 won for gasoline, 145 won for diesel and 51 won for LPG butane.
The government explained that, because tensions in the Middle East have not been fully resolved, it needs to prepare for the possibility of greater volatility in oil prices. The aim is to preserve policy room for additional measures if prices rise again, while keeping the current level of tax relief to reduce the burden on consumers.
Earlier, in March, the government raised the gasoline fuel tax cut rate from 7% to 15% and increased the diesel cut from 10% to 25%. In May, it also lifted the LPG butane cut rate to 25%.
The government plans to submit revisions to the Enforcement Decree of the Transportation, Energy and Environment Tax Act and the Enforcement Decree of the Individual Consumption Tax Act to the State Council of South Korea later this month before implementing the extension.


[email protected] Kim Chan-mi Reporter