Wednesday, February 1, 2023

Ogra proposed raising petrol prices 83.5 per liter

The Oil and Gas Regulatory Authority (OGRA) has recommended that the federal government increase fuel prices by up to Rs83.5 per liter on petrol and Rs119 per liter of diesel in Pakistan.

The Oil and Gas Regulatory Authority (OGRA) has given a report to the Petroleum Division on the imposition of a significant increase in Petrol prices in Pakistan beginning on April 16.

According to sources, the proposed raise was calculated on the basis of the 70 percent GST and the Rs30 per liter charge. The current charge on fuel and gasoline is Rs30 per liter, plus 17 percent of the Goods and Services Tax (GST).

The authority has recommended that an Rs83.5 per liter increase in petrol be implemented on the basis of the complete levy and taxes, whilst an Rs119 per liter increase in diesel has been proposed by the authority.

In line with the current tax rate, the Oil and Gas Regulatory Authority (OGRA) proposed raising the price of petrol up to Rs21.53 per liter, diesel up to Rs51.3, and kerosine oil up to Rs77.56 per liter on the basis of the complete tax and levy.

With regard to other petroleum products, an Rs77.31 increase was proposed for light diesel, an Rs36.5 increase for kerosine oil, and an Rs38.89 increase for light diesel when the entire tax and levy rate was applied.

According to reliable sources, the finance ministry will make the final decision on the OGRA report after talking with Prime Minister Shehbaz Sharif on the matter.

Read Also: Pakistan’s growth predicted reduced to 4.3% by the World Bank

“At the present rates of taxation, the rate rise OGRA has requested is Rs 21/liter in petrol and Rs 51/liter in diesel,” said Hammad Azhar, a former energy minister and the current focal person for the economy for the Pakistan Tehreek-e-Insaf (PTI). This is the differential that the PTI government was effectively subsidizing in order to bring relief to the general public.”

In its proposals, the OGRA always includes two options: one with full taxes and one with minimal taxes. “The figure used in the media was based on a scenario with full taxes,” Azhar explained.

It was also expressed hope that the “entire pricing disparity mechanism” that had been put in place to bring assistance to the masses would not be disrupted by the new government.

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