Refiners of North Sea crude face rebate cut

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Refiners of North Sea crude face rebate cut

Korean refiners that import North Sea crude will have their rebates for oil-product exports reduced under tax changes planned to start April 1, according to three government and refinery officials.

Companies have been asked to submit their views on the proposed tax revisions by Monday, according to officials at the Korea Customs Service, SK Innovation and the Korea Petroleum Association who asked not to be identified, citing department and company policies.

The new rules would apply to refiners that buy North Sea crude, which is exempt from a Korean import tariff of 3 percent under a free trade agreement with the European Union, the officials said.

Korean refiners are currently entitled to a tax rebate on all their oil-product exports, even if they are produced using duty-free crude, according to the Korea Petroleum Association official. The government plans to adjust the refund depending on the proportion of the refiners’ crude imports that aren’t subject to the tariff, according to a statement on the Korea Customs Service’s Web site on Feb. 25.

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