South Korea Extends Fuel Tax Cuts Through July

South Korea plans to extend its fuel tax cut program by two months through July 31, the Ministry of Finance and Economy said Thursday. Finance Minister Koo Yun-cheol announced the measure at a meeting with other ministries focused on containing price increases. The current 15 percent tax reduction on gasoline and 25 percent reduction on diesel will remain in effect.

Korea introduced the fuel tax cuts in March after supply disruptions tied to the Middle East conflict. The program had been scheduled to end this month. 6 percent in April from a year earlier, the fastest increase in 21 months. 9 percent over the same period, the largest gain since July 2022.

The government said it will strengthen monitoring for hoarding of key goods. The Korea Customs Service commissioner will receive authority to investigate suspected hoarding during customs clearance. Financial penalties exceeding any illicit gains will be sought, and rewards will be offered for reports of violations, the ministry added.

"We believe the tax cut measure will help ease consumer price pressures," a finance ministry official said. "We are not at the point of discussing when to end the fuel tax cut program," another ministry official said.