Petroleum levy rises to Rs70.36 per litre despite fuel price cut
The government has increased the petroleum levy on petrol by Rs6.22 per litre. With the latest revision, the levy has gone up from Rs64.14 to Rs70.36 per litre.
At the same time, the petroleum levy on diesel has been reduced by Rs6.22 per litre. The levy has dropped from Rs77.04 to Rs70.82 per litre.
The petroleum levy on kerosene has not been changed. It will continue to remain at Rs20.36 per litre.
The government issued a separate notification confirming the revised petroleum levy. This notification was released along with the latest fuel price announcement.
Late on Friday night, the federal government also reduced the prices of petrol and diesel by Rs1.97 per litre. The new fuel prices came into effect immediately across the country.
Officials said the revised levy will now become part of the petroleum pricing system. The move is aimed at increasing government revenue and achieving fiscal targets under the ongoing economic reform programme.
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The petroleum levy is one of the federal government’s biggest sources of non-tax income. Unlike many other taxes, the money collected through this levy is kept entirely by the federal government and is not shared with the provinces under the National Finance Commission Award.
The latest increase follows changes introduced in the federal budget. These changes included new fuel tax adjustments and the implementation of the Climate Support Levy.
The government has continued to rely on petroleum-related levies to improve public finances. It is also working to meet commitments under its economic programme supported by the International Monetary Fund.
Although people do not pay the petroleum levy separately at fuel stations, it is included in the retail price of fuel. Higher fuel taxes can increase transport and delivery costs, which may eventually lead to higher prices of goods and services.
With this latest revision, the petroleum levy on petrol has crossed Rs70 per litre for the first time under the current pricing structure. The government is using this approach to generate more revenue without increasing the general sales tax on petroleum products.
The latest decision shows that the government is trying to improve its financial position while keeping fuel prices under control. However, higher petroleum levies may still increase business costs and could affect the prices of everyday items in the coming months.
