South Korea Plans LNG Bunkering Tax Incentives

by Ship & Bunker News Team
Tuesday August 10, 2021

South Korea's government plans to subsidise take-up of LNG bunkering through its tax system.

The government will provide tax rebates on import tariffs for LNG used for bunkering as of the start of 2022, price reporting agency S&P Global Platts reported on Tuesday, citing comments from an official at the Ministry of Trade, Industry and Energy.

The current import surcharge of 24.20 Won/kg (2 cents/kg) is set to be lifted. 

"The abolition of import surcharge for LNG-fuelled vessels is expected to help boost the country's efforts to develop LNG bunkering and cope with marine fuel regulations," Platts cited the ministry official as saying.

LNG bunker demand is rising rapidly as some shipowners seeking to cut their carbon emissions have regarded it as the only propulsion technology currently mature enough to switch to. Supporters of LNG note the potential for LNG-fuelled vessels to run on synthetic or bio-LNG at a later date when these become more widely available, or even be retrofitted to run on ammonia.

Opponents of gas-powered shipping regard LNG as just another fossil fuel, and a waste of resources for the shipping industry while it should be focusing efforts on switching to zero-carbon fuels.