Government to consider extending fuel tax cuts

A sign shows gas prices at a filling station in Seoul, in this photo taken Feb. 13 shows. Yonhap

The government plans to consider extending fuel tax cuts as the country's inflationary pressure is growing amid surging energy costs, a senior official said Friday.

The administration cut fuel taxes by a record 20 percent Nov. 12 in a bid to tame inflationary pressure. The measure will be in effect until April 30.

"Inflation is expected to be tough as well in February as demand-pull price pressure remains high, and energy and raw material prices have continued to rise," First Vice Finance Minister Lee Eog-weon said at a government meeting on inflation.

In January, consumer prices rose 3.6 percent from a year ago, compared with a 3.7 percent year-on-year gain in December last year, as inflation grew more than 3 percent for the fourth straight month. The Bank of Korea aims to keep annual inflation at 2 percent over the medium term.

Tensions between Russia and the U.S. over Ukraine have driven up already high oil prices. Russia is one of the largest oil producers.

Dubai crude, Korea's benchmark, soared to $93.05 per barrel Tuesday, up from $77.12 at the end of last year. Korea depends mainly on imports for its energy needs.

The government said it will also closely monitor hikes in prices of processed foods and dining out in a bid to curb inflation.

Starting next week, the Korea Agro-Fisheries Food Trade plans to make public menu prices of 12 major food items sold by top franchise brands every week.

A consumer protection agency will also look into delivery fees charged by food delivery app operators every month and unveil detailed information. Hikes in delivery fees are partly blamed for the latest rise in prices of dining out. (Yonhap)