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Transport costs to climb after steep rise in utility bills

Bus, subway, taxi fares set to rise; electricity and gas rates likely to be raised further

Jan. 29, 2023 - 16:04 By Kim So-hyun
Taxis in Seoul. Yonhap

As South Koreans are still trying to process the shocking heating bills they received this month, taxi and public transport fare hikes await.

In some regions, water and sewer fees, as well as volume-based waste disposal fees, are also slated to rise.

In Seoul, the base fare for a midsized sedan cab will jump by 1,000 won (81 cents) to 4,800 won from 4 a.m. on Wednesday, the first hike in four years.

The distance covered with the initial fare will be reduced from the current 2 kilometers to 1.6 kilometers.

As for deluxe and large-sized taxis, the standard fare for the first three kilometers will climb from 6,500 won to 7,000 won.

Seoul City also plans to raise bus and subway fares for the first time in eight years by between 300 and 400 won in April.

Under the plan -- which will go through public hearings, city council hearings and the city’s inflation committee -- the city bus fare, when paid by credit card, will rise from the current 1,200 won to between 1,500 and 1,600 won.

The subway fare will be increased from the current 1,250 won to between 1,550 and 1,650 won.

Other metropolitan or provincial governments are also seeking to go ahead with public transport fare hikes which they have put off for years.

Incheon City is reviewing raising subway and bus fares to levels similar to Seoul, while South Gyeongsang Province and Ulsan City are considering pushing up their bus rates.

Busan City, South Jeolla Province and Daegu City are also looking into possible hikes.

As for taxis, Daegu raised the base fare from the previous 3,300 won to 4,000 won this month, and Daejeon plans to increase it from 3,300 won within the first half of this year.

Most provincial governments are considering taxi fare hikes within this year.

According to Statistics Korea’s consumer price index, transportation costs already surged 9.7 percent last year, marking the steepest annual increase in 24 years since 16.8 percent in 1998.

Transportation costs consist of categories for transportation equipment, such as purchase of vehicles; operation of personal transportation equipment such as fuel costs; and transportation services including bus, subway, taxi and air transport.

The cost of operating personal transportation equipment jumped 15.9 percent last year on international oil price hikes, leading the overall rise in transportation costs.

As the central government has announced steeper electricity and gas rate hikes this year, city gas retail prices are bound to surge further.

The government has raised the electricity rate by 13.1 won per kilowatt hour for the first quarter of this year, a quarterly increase that is likely to be applied throughout the year, compared to a 2.5 won hike per kWh in the last three months of 2022 and 19.3 won per kWh for the whole of 2022.

The retail price of city gas rose about 38 percent last year as the international price of liquefied natural gas, mostly used for heating, jumped 128 percent.

The government has said that additional gas rate hikes will be unavoidable after the second quarter of this year.

Other public utility rates are also expected to rise.

Seoul City has raised water rates for homes by 100 won from the previous 480 won per metric ton, with Incheon, Ulsan, Daejeon and Sejong planning to increase their water and sewer rates.

Even the price of user-pay garbage bags will rise in Gyeonggi, South Jeolla and Gangwon provinces.