Gyeonggi Province: Regional Development Bond Required for Hybrid Vehicles Over 1,600cc Starting in July

Starting July 1, anyone registering a non-commercial hybrid vehicle with an engine displacement exceeding 1,600cc in Gyeonggi Province will be required to purchase a regional development bond.

The Gyeonggi Provincial Government announced on June 11 that it has revised the "Ordinance on the Establishment of the Gyeonggi-do Regional Development Fund" in line with the expiration of the 2024 government policy providing acquisition tax reductions for hybrid vehicles. This move also aligns with the fact that 9 out of 17 cities and provinces nationwide have already mandated the purchase of such bonds for hybrid vehicles.

A regional development bond is a type of municipal bond that must be purchased when registering a vehicle; principal and interest are returned to the purchaser at maturity.

As a result, those registering a hybrid vehicle in Gyeonggi Province will be required to purchase a regional development bond before registration, just as with conventional internal combustion engine vehicles. However, the purchase of the bond will continue to be waived for commercial vehicles or hybrid vehicles with an engine displacement of 1,600cc or less.

Gyeonggi Provincial Government

The bond purchase amount varies depending on the vehicle type and engine displacement. For example, if you are registering a hybrid passenger car priced at 35 million won with an engine displacement exceeding 1,600cc but not more than 2,000cc, you would need to purchase bonds worth 2.8 million won, equivalent to 8% of the tax base for acquisition tax.

Residents who have purchased regional development bonds will be able to redeem the principal and an annual interest of 2.0% from the fifth year after purchase.

Revenue from the Gyeonggi-do Regional Development Fund is used for projects promoting balanced regional development and the welfare of residents, such as public development projects and road construction. To date, it has been utilized for the development of public housing districts in the third phase of new towns, development in the Godeok Internationalization Planning District, various ecological stream restoration projects, and provincial road construction.

This content was produced with the assistance of AI translation services.