The government is extending the tax-exempt fuel subsidy for agriculture and fisheries until the end of the year, allocating an additional 791 billion won to alleviate the financial burden on farmers and fishermen due to high oil prices.
On September 29, the government approved a budget of 791 billion won for the extension of the fuel subsidy during a Cabinet meeting.
The additional funding includes 660 billion won for agriculture and 131 billion won for fisheries. The agricultural subsidy will cover tax-exempt diesel used in tractors, tillers, and combines, as well as heating oil for horticultural facilities, while the fisheries subsidy will support tax-exempt diesel.
This year, the government allocated 1.188 trillion won in the first supplementary budget to temporarily support the tax-exempt fuel subsidy for agriculture and fisheries since March. The subsidy compensates 70% of the excess amount when the price of tax-exempt fuel exceeds a set benchmark.
In May, the government increased the subsidy limit for tax-exempt diesel from 138.4 won per liter to 176.2 won, raising it by 37.8 won to expand support for farmers and fishermen.
The subsidy was initially set to end at the end of September, but the decision to extend it was made as tax-exempt fuel prices remained high. In the fourth week of September, the price of tax-exempt diesel was 1,401 won per liter, a 24.9% increase from 1,122 won on February 27. During the same period, the price of tax-exempt kerosene also rose from 1,115 won to 1,386 won, a 24.3% increase.
As part of the measures announced on September 1 to stabilize living conditions during the Chuseok holiday, the government decided to extend the subsidy period until the end of December. This budget allocation is intended to cover the additional costs for the fourth quarter due to the extension.
The Ministry of Agriculture, Food and Rural Affairs and the Ministry of Oceans and Fisheries plan to revise the project guidelines this week to reflect the changes in the subsidy period and budget, and to monitor the implementation status.
* This article has been translated by AI.
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