South Korea is considering introducing a tax on coal for power generation and reducing taxes on fuels for cooking and heating (such as propane or kerosene) as of 1 July 2014, in an attempt to limit electricity consumption during the summer (peak period in the country) and to limit blackout risks. The tax would be Won 17/kg (US$1.58c/kg) of coal with a net calorific value below 5,000 kcal (4.187 J) and Won 19/kg (US$1.76c/kg) of coal with a net calorific value above 5,000 kcal. The consumption tax for LNG would decrease to Won 42/kg from Won 60/kg (US$3.91c/kg and US$5.56c/kg, respectively), that on fuel oil from Won 90/l to Won 63/l (US$8.38c/l and US$5.86c/l, respectively) and than on propane from Won 20/kg to Won 14/kg (US$1.86c/kg and US$1.30c/kg, respectively). The government aims to encourage industrial consumers to use gas or other fuels for manufacturing processes. It expects the tax revision to curb electricity consumption due to higher coal prices and to boost the consumption of LNG, fuel oil and propane.
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