Pakistan set to increase petroleum levy, GST

The petroleum levy and general sales tax on sales of petroleum products to consumers is expected to go up by Rs1.3 billion (US$ 23.4 million) in April 2013 as the Pakistani government has made less-than-required reductions in prices of oil products.
For the whole month, the government is likely to receive Rs24 billion (US$432.1 million) in revenues on account of both taxes.
According to sources, the government received Rs22 billion (US$396.1 million) from the petroleum levy and GST in March and this came despite the withdrawal of oil product price increases early in the month.
On March 31, the government announced a slight reduction in prices of petrol, diesel, kerosene and other products despite a sharp decline in the international market.
In its recommendation, the Oil and Gas Regulatory Authority (OGRA) had called for cutting the price of high speed diesel by Rs1.45 (US$0.03) per liter, petrol by Rs1.80 (US$0.03) per liter, light diesel oil by Rs4.93 (US$ 0.09) per liter and kerosene by Rs4.46 (US$.08) per liter.
An official told The Express Tribune that the finance ministry had opposed the cut in petroleum product prices and suggested that the reduction should be adjusted in the petroleum levy. The ministry argued that it had lost Rs4.5 billion (US$81 million) in revenues last month after the increase in oil prices was taken back and the rate of petroleum levy was brought down following orders of the former prime minister.
Later, the ministry agreed on a small decrease in prices and the rest was adjusted in the petroleum levy “to make up for the revenue loss a month earlier.”
(April 2, 2013)