Islamabad, June 29, 2023: Pakistan is preparing to make a surprise announcement regarding petroleum prices for the next 15 days, effective from July 1, 2023. The country follows a bi-weekly schedule for announcing price adjustments.
The government’s announcement, scheduled for June 30, 2023, will determine the prices for the first fortnight of July 2023. This news comes at a time when Pakistan has received its second shipment of cheaper Russian petroleum.
However, there is speculation that the upcoming announcement may also include the implementation of an increased petroleum levy. The government has recently obtained approval from the National Assembly to raise the petroleum levy from Rs50 to Rs60 for the fiscal year 2023-24.
If the petroleum levy is applied as expected, it may lead to a surge in petroleum prices nationwide. The government aims to generate approximately Rs870 billion through the petroleum levy in the fiscal year 2023-24, demonstrating its determination to enhance revenue despite challenges in the petroleum sector.
In the previous fiscal year 2022-2023, the government initially targeted Rs855 billion in petroleum levy collections, but this was later revised downward to Rs542 billion. Therefore, the government faces the task of collecting an additional Rs328 billion in the upcoming fiscal year to meet its ambitious revenue goal.
The government’s decision to increase petroleum prices in the next fiscal year, despite benefiting from affordable oil imports from Russia and falling international prices, highlights its reliance on the petroleum sector as a revenue source.
While the increased petroleum levy may contribute to the government’s revenue generation efforts, it is essential to consider its potential impact on the general population. Higher petroleum prices could lead to increased transportation costs, elevated prices of essential commodities, and an overall burden on the average consumer.
The implementation of the increased petroleum levy and its implications for Pakistan’s economic landscape will unfold in the coming days. The government’s ambitious revenue target reflects its commitment to finding innovative solutions amidst challenges faced by the petroleum sector. However, striking a balance between revenue generation and the well-being of the populace will be crucial for ensuring sustainable economic growth.
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