Ruling Party and Government to Cut Fuel Tax by 20% for 6 Months... Gasoline Price Down by 164 Won per Liter

Diesel 116 Won·LPG Butane 40 Won↓
LNG Quota Tariff Also Reduced

Song Young-gil, leader of the Democratic Party of Korea, is delivering opening remarks at the party-government meeting on price stabilization held at the National Assembly on the 26th. Photo by Yoon Dong-joo doso7@

[Asia Economy Reporter Jeon Jinyoung] The Democratic Party of Korea and the government decided on the 26th to reduce the fuel tax by 20% for six months starting from the 12th of next month, considering the recent surge in oil prices.

On the morning of the same day, the party and government held a meeting on price measures at the National Assembly to discuss this plan. After the meeting, Park Wan-joo, the Policy Committee Chair of the Democratic Party, stated in a briefing, “In response to the sharp rise in international oil prices and domestic gasoline prices, we have decided to temporarily reduce the fuel tax on gasoline, diesel, and LPG butane by 20%.”

As a result of this measure, gasoline prices will drop by up to 164 KRW per liter, diesel by 116 KRW, and LPG butane by 40 KRW. For drivers who travel 40 km per day, this translates to about a 20,000 KRW reduction in monthly fuel costs.

They also decided to lower the tariff quota imposed on liquefied natural gas (LNG). Park said, “We have decided to reduce the tariff quota rate on LNG, which is currently applied at 2%. This is expected to ease the burden of price increases and alleviate the costs for commercial LNG industry companies.”

In addition, the party and government will continue efforts to stabilize living costs by freezing public utility rates in the fourth quarter and holding supply management discount events focused on major agricultural, livestock, and fishery products.

Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, said in his opening remarks, “Domestic gasoline prices have reached the mid-1700 KRW range, the highest in seven years, and the Democratic Party has continuously raised this issue, prompting consideration of a price reduction.”

Deputy Prime Minister Hong emphasized, “We will swiftly proceed with follow-up measures such as revising enforcement ordinances as soon as the decisions are finalized at today’s party-government meeting and the economic ministers’ meeting. We will also do our best to ensure that the annual inflation rate is stably managed in the low 2% range.”

Song Young-gil, leader of the Democratic Party, stated, “Even if oil prices decrease, it takes time for people to feel the effects, so we will prepare various comprehensive policies and detailed measures to shorten this period as much as possible.”