ISLAMABAD: The federal government, led by Prime Minister Shehbaz Sharif, is set to announce a substantial increase in petrol prices starting July 1, in line with the implementation of the Budget 2024-25. This will be the first price adjustment since the budget for the fiscal year 2024-25 was presented on June 12.
Increased Petroleum Levy in Finance Bill 2024
In the newly proposed Finance Bill 2024, the government has raised the maximum petroleum levy by Rs20, bringing it to Rs80 per litre. This increase is expected to significantly impact petrol and high-speed diesel (HSD) prices nationwide.
Current Fuel Prices
Currently, petrol is priced at Rs258.16 per litre, and HSD at Rs267.89 per litre, following recent reductions of Rs10.20 and Rs2.33, respectively. However, with the new levy, these prices are anticipated to rise sharply.
Revenue Generation and IMF Bailout
The petroleum levy has been identified as a critical revenue source for the government, which is aiming to strengthen its finances and secure another bailout package from the International Monetary Fund (IMF). This measure is part of the government’s strategy to boost revenue, targeting Rs12.97 trillion for the Federal Board of Revenue (FBR) in the upcoming fiscal year.
Economic Impact
Market analysts predict that the increased petroleum levy will directly lead to higher fuel costs for consumers. The exact extent of the price rise will be confirmed on June 31, when the government finalizes the revision. This expected surge in fuel prices comes at a time when the public is already facing significant inflationary pressures, likely exacerbating the economic burden on households and businesses alike.
