Islamabad, May 10, 2025 – The federal government has reported a substantial increase in revenue collected from the petroleum levy, reaching a total of Rs834 billion during the first nine months (July–March) of the current fiscal year, according to official data released by the Ministry of Finance.
This marks a 16% rise in the collection of the petroleum levy compared to the same period last year, when the figure stood at Rs720 billion. The petroleum levy remains a critical component of the government’s non-tax revenue framework, consistently generating large sums by levying charges on petroleum products consumed across the country.
The government’s reliance on the petroleum levy has grown significantly, especially as it seeks to boost revenue without increasing direct taxes. By maintaining relatively high fuel prices, the state continues to impose a financial burden on end consumers, thereby maximizing collections under this head. The petroleum levy, while controversial, is seen as a dependable source of revenue that bypasses traditional tax enforcement challenges.
In the previous fiscal year (2023–24), the total petroleum levy collection stood at Rs1.02 trillion, and current trends suggest that the government is well on track to exceed that amount this year. The continued upward trajectory of collections underscores the administration’s strategic focus on petroleum products to meet fiscal targets.
In addition to this, the government also generated Rs35.65 billion from the natural gas development surcharge, another source of non-tax revenue. Moreover, an amount of Rs2.44 billion was specifically collected from the petroleum levy imposed on Liquefied Petroleum Gas (LPG) during the July–March period of FY2024–25.
Cumulatively, the total federal non-tax revenue soared to Rs4.03 trillion in the first nine months of the fiscal year, showing a robust 87% increase over the Rs2.36 trillion collected during the same period last year.
The repeated and expanded use of the petroleum levy underscores its significance in the federal revenue architecture. With petroleum remaining a key import and consumption item, the levy on these products continues to be an effective—though often burdensome—mechanism for revenue generation. The government is expected to retain, if not enhance, this strategy in the remaining fiscal quarter.