After months, Pakistan is again going to witness a record high petrol price in a coming price revision unleashing a full wrath on citizenry. As per the sources, price of petrol is likely to jack up by Rs. 9.50 taking it to the new rate of Rs. 289.25 from the previous Rs. 279.75.
Meanwhile, the diesel price is predicted to see a jump of Rs. 0.86 reaching Rs. 285.56 from old rate of Rs. 287.33 for the next fortnight.
The Reason
The driving force behind this move, or what can prompt the newly established government to announce such a substantial hike in petrol prices, is primarily attributed to the International Monetary Fund (IMF) recommendation to reintroduce an 18% general sales tax (GST) on petrol as a condition for the release of the final tranche of its bailout package.
Additionally, there have been reports indicating that the government intends to raise the petroleum levy from Rs. 60 to Rs. 100. The Petroleum Development Levy has witnessed various adjustments in recent years, with a notable increase during the fiscal year 2023.
Initially set at Rs. 20 per liter in July 2022, the petroleum levy on petrol was subsequently raised to Rs. 50 per liter in November 2022, and further escalated to Rs. 60 per liter until September 2023.
Currently, the government is imposing a development levy of Rs. 60 per liter on both petrol and diesel, which stands as the maximum limit under the law. In determining these prices, the government takes into account factors such as the requirements of Pakistan State Oil, taxes, and global oil prices.
Presently, the government is levying approximately Rs. 82 per liter tax on both petrol and diesel. Although there is no General Sales Tax (GST) applied to all petroleum products, the government is collecting a petroleum levy of Rs. 60 per liter on both products.
What do you think about the expected surge in petrol prices? Drop your thoughts in the comments section.
