Exemption from Purchase Cost of Bonds for Vehicles Under 1600cc Starting March

Ministry of the Interior and Safety, for the Stability of the Low-Income Economy

The Ministry of the Interior and Safety announced on the 26th that, starting in March, the purchase of local development bonds and urban railway bonds will be exempted when registering non-commercial passenger cars (private cars) under 1600cc or when entering into construction, goods, or service contracts under 20 million KRW with local governments to stabilize the livelihood economy.

The Ministry of the Interior and Safety and local governments plan to complete the revision of city and provincial ordinances by the end of February and simultaneously implement the measures nationwide from March 1.

First, when registering non-commercial passenger cars (private cars) under 1600cc based on engine displacement, bond purchases will be exempted regardless of the car’s specifications or price. This applies not only to new registrations but also to transfer registrations.

To further ease the burden on citizens, some cities and provinces offer additional exemptions. Also, to support small business owners and self-employed individuals, bond purchases will be exempted when contracts under 20 million KRW are signed with local governments.

Meanwhile, since January this year, the Ministry of the Interior and Safety and cities and provinces have raised the coupon rate of local development bonds and urban railway bonds from 1.05% (1% in Seoul) to 2.5%.

Choi Byung-kwan, Director of the Local Finance and Economy Office at the Ministry of the Interior and Safety, stated, “In the current difficult economic situation due to high interest rates and inflation, we hope this system improvement will help reduce the burden on citizens and small business owners even slightly,” adding, “We will continue to cooperate with local governments to prepare policies and improve regulations that citizens can feel.”