Choo Kyung-ho "Fuel Tax Maximum Reduction of 37% Until Year-End" (Update)

The 1st Emergency Economic Ministers' Meeting

Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho is presiding over the 1st Emergency Economic Ministers' Meeting at the Government Seoul Office Building on the holiday, June 19, 2022. Photo by Yonhap News.

[Asia Economy Sejong=Reporter Son Seon-hee] Deputy Prime Minister and Minister of Economy and Finance Choo Kyung-ho said on the 19th, "We will expand the fuel tax reduction rate to 37%, the maximum limit allowed by law, from July to the end of the year to induce a reduction in petroleum product sales prices."

Deputy Prime Minister Choo presided over the 1st Emergency Economic Ministers' Meeting at the Government Seoul Office in the afternoon and stated, "We intend to urgently implement measures to alleviate the burden on ordinary citizens caused by high oil prices."

He also said, "To reduce the fuel cost burden on the freight and transportation industries, we will lower the standard price for diesel fuel price-linked subsidies from 1,750 won per liter to 1,700 won, a 50 won reduction," and added, "For domestic aviation fuel, we will apply a tariff quota, reducing the current import tariff from 3% to 0%, thereby easing the upward pressure on domestic airfares." Furthermore, he said, "To promote public transportation use and reduce the burden on ordinary citizens due to high oil prices, we will double the income deduction rate for public transportation credit card use in the second half of the year from the current 40% to 80%."

Ahead of the announcement of the electricity rate increase plan on the 21st, Deputy Prime Minister Choo said, "Electricity and gas rates, which are burdened by rising international energy prices, will minimize increases through painful self-help efforts."

However, he added, "In principle, public institutions and local governments will absorb cost increases as much as possible through management efficiency," and "Central and local public utility fees such as railways, postal services, and water supply and sewage will be frozen in the second half of the year as a principle and managed as stably as possible."

Regarding agricultural and livestock products expected to see price increases ahead of the summer season, Deputy Prime Minister Choo said, "We will monitor market trends daily, focusing on items with rising prices, and stabilize the market through timely responses such as releasing stockpiled goods, emergency imports, supply and demand management, and price discounts." He added, "We will also consider additional measures for supply stabilization, such as expanding the application of tariff quotas depending on market conditions."

Deputy Prime Minister Choo especially mentioned support for vulnerable groups affected by rising prices, saying, "Starting from the 24th, we plan to begin payments of up to 1 million won (for a family of four) to 2.27 million low-income households," and "Energy vouchers for 1.18 million low-income households using energy will also be implemented from the 1st of next month."

Deputy Prime Minister Choo said, "In this severe situation, the economic team will not let down its guard for a moment," and "Under the responsibility of each ministry, we will conduct daily checks on price and supply-demand trends for key items in their respective areas and respond immediately if signs of instability are detected."

This content was produced with the assistance of AI translation services.