The government will extend the tax cut on fuel consumption by an additional two months amid growing tensions in the Middle East, Finance Minister Choi Sang-mok said Monday.
South Korea has applied a 25 percent discount on the consumption of gasoline and a 37 percent discount on the consumption of diesel and liquefied petroleum gas, which were supposed to expire at the end of this month.
“In an effort to prevent the growth of economic burdens on the people, the government will extend the tax cut by another two months through the end of June,” Choi said during an emergency economic ministers’ meeting.
Dubai crude, the country’s benchmark, has been on a constant rise in recent months reaching US$89.87 per barrel in April from $78.85 in January, $80.88 in February and $84.18 in March amid the Israel-Hamas war and other geopolitical uncertainties.
Global oil prices are feared to rise further following Iran’s attack on Israel last weekend and concerns over a wider conflict in the region.
South Korea depends o
n imports for most of its energy needs, and the government began implementing a fuel tax cut scheme in 2021 and has extended it eight times so far.
“The government will operate a joint emergency response team of related agencies to monitor the economic situation and financial market on a real-time basis,” Choi said.
“The government will swiftly implement necessary measures based on contingency plans to market volatility,” he added.
Source: Yonhap News Agency