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The government has announced a W10.5 trillion policy package designed to help Koreans deal with record-breaking crude oil prices (US$1=W1,024). The most eye-catching part of the package is a W60,000 to W240,000 "oil refund" which will be given to 13.8 million Koreans over the next year. They include 9.8 million employed people who earn less than W36 million a year and 4 million self-employed business people whose annual total income is less than W24 million. Refunds awarded to 78 percent of all working Koreans and to 87 percent of all self-employed business people will amount to W3.14 trillion.
Businesses involved in city bus, express bus and other public transport services, as well as farmers and operators of cargo trucks and coastal cargo vessels, will receive not only the oil refund, but an additional rebate amounting to half of the rise in diesel prices in the future. Drivers of trucks less than a ton in cargo capacity will receive up to W100,000 in support each year. Also included was support for oil costs for low-income families as well as measures to stabilize electricity and gas fees for those people.
Including the oil rebate, a total of W8.435 trillion will go into the government's oil cost relief policy package. The government will spend another W2.58 trillion on bolstering energy saving facilities, expanding the use of renewable energies and the search for energy resources. Those two policies add up to W10.5 trillion in support payments, which amounts to half of the increase in the public's cost burden due to soaring crude prices.
This policy package is aimed at funneling limited government resources to aid workers, self-employed business people, the disabled and farmers. It is also the first time that the government has directly handed out tax rebates.
Skeptics question how much of an impact W240,000 in rebates per household will have on alleviating cost burdens. But it is difficult to expand the government's support measures in light of the country's fiscal status. Along with efforts to develop renewable and alternative forms of energy, it is time to look into a comprehensive reevaluation of our country's energy consumption patterns and industrial and transportation structures, which rely too heavily on crude oil.
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