The government says it will not increase tax on diesel fuel, following news reports speculating an imminent diesel price hike.

Deputy Finance Minister for tax and customs affairs Choi Young-rok announced the government’s decision at a press briefing Monday.

Choi said they had entrusted think tanks to come up with a more effective energy tax scheme to combat fine dust and were advised against raising the diesel price as it would be inefficient for reducing the problem.

Overseas factors, he said, turned out to be the biggest cause of fine dust that has been inflicting damage to the country.

Choi also pointed out that consumption of diesel was assessed to be price inelastic, and that a diesel tax hike would end up increasing tax burdens on the self-employed and truck drivers, rather than discourage the use of diesel cars.