Foul fuel

Diesel price hike in South Korea to curb air pollution

Published: Wednesday 15 June 2005

To reduce the number of environment unfriendly diesel vehicles on the roads, the South Korean government has announced its plan to raise the transport tax on diesel by 14.4 per cent (US $0.046 per litre) from July 2005. The move is a part of its plan to raise the domestic retail price of diesel to 85 per cent of the gasoline price by July 2007; it is nearly 70 per cent of the gasoline price now. The plan will be submitted to the country's national assembly in June 2005 for approval.

Passenger cars, sport utility vehicles, buses and trucks are the four kinds of diesel-run vehicles in the country. Cars, comprising 36.2 per cent of the registered vehicles, are the prime targets of the hike, which will be fully covered by government subsidies for bus and truck operators. The government also plans to provide a tax rebate on the less polluting liquefied petroleum gas (LPG), mainly used in taxis and mini vans.

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