South Korea Extends Fuel Tax Cuts Through Sept. 30

Gasoline 15% Lower, Diesel 25%, Butane 25%

South Korea will extend its temporary fuel tax cuts by two months through Sept. 30.

The Ministry of Economy and Finance said July 24 that the government discussed the plan at a special task force meeting on consumer prices chaired by Vice Prime Minister and Finance Minister Koo Yun-cheol at the Government Complex Seoul.

The extension keeps current fuel tax cuts in place through Sept. 30: 15% for gasoline, 25% for diesel and 25% for butane. That leaves fuel taxes at 698 won per liter for gasoline, down 122 won from the pre-cut rate, 436 won for diesel, down 145 won, and 152 won for butane, down 51 won.

The government said it lowered the maximum price of petroleum products last month to reflect a decline in global oil prices following a ceasefire agreement in the Middle East war. Still, it said uncertainty in the region remains and that it needs to preserve room to adjust fuel taxes if needed.

It added that it maintained relatively larger cuts for diesel, which is essential for industry and logistics, and for butane, which is commonly used by small trucks and as a household fuel for ordinary consumers, in an effort to limit the burden on the public.

The government plans to implement the measure swiftly after revisions to the enforcement decrees of the Transportation, Energy and Environment Tax Act and the Individual Consumption Tax Act go through vice ministerial and Cabinet meetings.

Park Su-rim, Hankyung.com reporter paksr365@hankyung.co.kr