與 Price Special Committee to Push for Expanding Legal Maximum Fuel Tax Cut from 30% to 50%

Preparing a Bill to Lower the Legal Maximum Reduction of Fuel Tax
Additional 50,000 Tons Expansion of Pork Tariff Quota Application

Ryu Seong-geol, Chairman of the People Power Party's Price and Livelihood Safety Special Committee, is giving an opening remark at the "1st Meeting of the Price and Livelihood Safety Special Committee" held at the National Assembly on the 16th. Photo by Yoon Dong-ju doso7@

[Asia Economy Reporter Lee Hyun-joo] The People Power Party announced on the 21st that it will expand the maximum statutory reduction rate of the fuel tax from the current 30% to 50%. Along with this, they have begun full-scale efforts to control prices by expanding the application of pork tariff quotas.

Ryu Seong-geol, chairman of the Special Committee on Price and Livelihood Stability, said to reporters after the meeting, "To operate the fuel tax more flexibly as previously announced, we will submit a partial amendment to the Transportation, Energy and Environment Tax Act," adding, "Currently, it is set at 30%, but we will propose an amendment to increase it to 50%."

The government previously held the first Emergency Economic Ministers' Meeting on the 19th and expanded the fuel tax reduction rate to 37%, the maximum limit allowed by law, from July to the end of this year. The fuel tax consists of transportation tax under the Transportation, Energy and Environment Tax Act, education tax (15%) corresponding to VAT, driving tax (21%), and an additional value-added tax (10%). The government has effectively achieved a 37% reduction compared to before by changing the transportation tax, which had been collected at a higher flexible rate, to the statutory rate and then applying the maximum statutory reduction rate of 30%.

The Price Special Committee plans to further expand the fuel tax reduction rate through legal amendments. The bill is being prepared by Assemblyman Bae Jun-young, who is participating as a member of the special committee.

Regarding the bill previously proposed by Assemblyman Seo Byung-soo to increase the reduction rate to 100%, Ryu said more discussion is needed. He explained, "During today's discussion, we agreed that if it were 100%, it would effectively mean the government is collecting tariffs, so the special committee decided to propose a 50% reduction as the representative bill."

Ryu added, "If the National Assembly is organized, the Tax Subcommittee can propose several additional bills," and "Bills proposed by Assemblymen Seo Byung-soo and Bae Jun-young will be consolidated for review."

The ruling party and government also decided to extend the application period of LNG tariff quotas until the end of this year and to increase the pork tariff quota by an additional 50,000 tons on top of the 50,000 tons that were previously imported quickly. In the opening remarks of the meeting, it was stated, "We will extend the application period of energy tariff quotas until the end of this year and also promote a plan to increase the pork tariff quota by an additional 50,000 tons."

Regarding the expansion of tariff quota items, Ryu said, "Since the inauguration of the Yoon Seok-yeol government, 14 items have already been announced, and just the day before yesterday, the government decided to reduce domestic aviation fuel from 3% to 1% for one item," adding, "The government will additionally review necessary items."

The Price Special Committee plans to conduct an on-site inspection by visiting the Garak Agricultural and Marine Products Wholesale Market in Songpa-gu, Seoul, in the early morning of the 24th.