Gov't to extend fuel tax cut through July amid consumer price pressure

South Korea plans to extend the fuel tax cut scheme by two months through the end of July amid growing inflationary pressure in the wake of the Middle East crisis, the finance ministry said Thursday. Finance Minister Koo Yun-cheol announced the measure during a meeting with related ministries on efforts to curb price increases, according to the Ministry of Finance and Economy. Under the plan, the current 15 percent tax cut on gasoline will remain in place through July 31, while a 25 percent cut on diesel will be maintained over the same period. South Korea introduced a price cap system on fuel products to address supply disruptions caused by the Middle East conflict in March, when it implemented the fuel tax cut program, which was originally scheduled to expire this month. "We believe the tax cut measure will help ease consumer price pressures," a finance ministry official said. In April, South Korea's consumer prices rose 2.6 percent from a year earlier, the fastest pace in 21 months. Prices of petroleum products surged 21.9 percent on-year, marking the sharpest increase since July 2022.

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