Govt decides to hike petroleum levy on RON-95 from Nov 16

Raise premium for OMCs on diesel for November and December
<p>Photo: File</p>

Photo: File

The federal government on Friday decided to increase the petroleum levy on RON-95 (HOBC) from the next petrol price revision cycle.

This was decided on Friday during a meeting of the Economic Coordination Committee (ECC) at the Finance Division. The meeting was chaired by Federal Finance Minister Senator Ishaq Dar.

Others who attended the meeting included federal ministers for Planning Ahsan Iqbal, Power Khurram Dastgir Khan, former prime minister Shahid Khaqan Abbasi, Minister of State for Finance Dr Aisha Ghous Pasha, Minister of State for Petroleum Musadik Masood Malik, SAPM on Finance Tariq Bajwa, SAPM on Revenue Tariq Pasha, federal secretaries, Federal Board of Revenue (FBR) chairman and other senior officers.

During the meeting, the FBR presented a summary on increasing the sales tax on RON-95 (HOBC).

The forum was informed that sales tax on petroleum products was reduced to zero from February 1, 2022.

FBR said that the measure put pressure on its efforts to achieve revenue targets.

After deliberation, the ECC allowed an increase in petroleum levy on RON-95 from Rs30 to Rs50 per liter and above with effect from November 16, 2022.

It was argued that HOBC is a luxury good consumed by wealthy consumers in expensive vehicles.

Diesel premium

Energy Ministry – Petroleum Division submitted a summary on High Speed Diesel (HSD) / Gas oil premium.

They said that due to the difference in premiums on import of HSD for the oil marketing companies (OMCs) and PSO, an unsustainable position developed for importing OMCs and ensuring smooth supply of HSD in the country.

To ensure sustained supply / import security, the ECC allowed premium on HSD – subject to maximum capping at $15/BBL – for importing OMCs other than Pakistan State Oil (PSO) for November and December 2022.

The ECC also approved Technical Supplementary Grants of Rs5 billion for conduct of the seventh population census.

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