The Pakistani government has hinted at increasing levy - up to 300 to 400 percent--on petroleum products from the next fiscal. Shaukat Tarin, the country’s finance minister, in a post-budget conference on Saturday, hinted at a possible increase in the prices.

“We will have to increase petroleum levy, take it up to Rs20 (PKR) per liter,” Tarin was quoted as saying by Dawn. Currently, there is Rs 4 to Rs5 (PKR) per liter levy on petrol and diesel. He also informed that an understanding had been reached with Saudi Arabia for the revival of its oil facilities on deferred payments. 

He explained that the price increase is necessary to achieve its petroleum levy target of $3.9 billion next year. This would not be inflationary, he said, in view of the expected lifting of US sanctions against Iran and its oil production and resultant lower international oil prices.

On negotiations with the IMF, he said, “they (IMF) want 40-45 percent increase in power tariff and 100 percent increase in personal income tax. This is regressive. We want to be progressive.”

Discussions with the IMF were continuing and even if the sixth review was not completed in July, they would try to complete the next review in September because both sides agreed on the same destiny of sustainable growth and stability in power sector finances, he said.

(SAM)