The federal government is considering a proposal to impose a General Sales Tax (GST) on petroleum or increase the current rate of levy further to meet IMF demand to restore 18% GST on petrol, sources familiar with the situation claimed.
It is proposed to increase the levy on petroleum from Rs60 to Rs100 per liter in the budget of the new financial year.
Currently, a levy of Rs60 per liter is imposed on petrol and diesel, with an estimated revenue of Rs 950 billion per year. GST on petroleum products has remained at zero level since March 2022.
In the budget, GST was proposed to be 18%.
The International Monetary Fund has demanded to restoration of the standard rate of GST, sources.
He government has announced its decision to maintain the price of petrol while reducing the price of high-speed diesel by Rs 1.77 per litre.
According to the notification, the price of petrol will remain unchanged at Rs 279.75 per litre. However, there has been a reduction of Rs 1.77 paise per litre in the price of high-speed diesel, bringing it down to Rs 285.56 paise per litre.
This decision comes amidst fluctuations in global oil prices and aims to provide stability in domestic fuel rates. The Ministry of Finance regularly reviews the prices of petroleum products to align them with international market trends while considering the impact on consumers and the economy.
Although not explicitly mentioned in the notification, sources from the Ministry of Finance indicate that there has also been a reduction of Rs. 2.12 per liter in the price of light diesel oil and Rs. 1.35 per liter in the price of kerosene.
Govt considering to increase GST on petroleum on IMF demand
