Korea may offer subsidy for buyers of hybrid vehicles

Those who buy hybrid vehicles to replace their old ones may receive a subsidy of up to 2 million won (US$1,713) from next year. New incentives besides the new tax cut will be necessary to cut down prices of the environmentally friendly vehicles in order to shore up the car industry, South Korea’s Ministry of Knowledge Economy (MKE) said. If finalized and approved, hybrid car buyers could save more than 5 million won (US$4,284) in total when combining tax breaks and the subsidy. Last July, the ministry launched a new program that will save buyers up to 3.1 million won (US$2,656) with the exemption of the special excise, registration and acquisition taxes. Korea has said it will consider additional subsidies for mini- and hybrid vehicles but no action has been taken so far. (August 23, 2009)