Government Extends Temporary Fuel Tax Reduction Measure Until April

As international oil prices fluctuate due to concerns over the spread of conflicts in the Middle East, affecting domestic gasoline prices, the government has decided to extend the temporary fuel tax reduction, which was scheduled to end this month, by an additional two months.

On the 16th, the Ministry of Economy and Finance announced that it will issue a legislative notice on the 19th to extend the temporary fuel tax reduction by two months through amendments to the 'Transportation·Energy·Environment Tax Act Enforcement Decree' and the 'Individual Consumption Tax Act Enforcement Decree.'

On the 6th, the average retail price of gasoline at gas stations reversed to an upward trend after 17 weeks. At a gas station in Seoul, gasoline is being sold at 1,609 won per liter and diesel at 1,539 won per liter. Photo by Jinhyung Kang aymsdream@

With the continuation of the temporary fuel tax reduction, the price reduction effect of 205 KRW per liter for gasoline, 212 KRW for diesel, and 73 KRW for liquefied petroleum gas (LPG) butane will be maintained. The amendment will be implemented from the 1st of next month after the legislative notice, consultations with related ministries, and the Cabinet meeting.

The Ministry of Economy and Finance stated, "Considering the ongoing uncertainty in domestic and international fuel prices due to instability in the Middle East situation, the price reduction effect of the fuel tax is expected to be maintained for the next two months, contributing to alleviating the fuel cost burden on the public."

As the Middle East conflict prolongs and Dubai crude oil, which serves as the benchmark for domestic gasoline prices, surged to around 80 dollars per barrel, the domestic gasoline price currently stands at 1,617.52 KRW per liter nationwide as of this afternoon. This is the first time in about two months that gasoline prices have risen to the 1,600 KRW per liter range. The average gasoline price in Seoul jumped to 1,700.92 KRW, reaching the 1,700 KRW range.