Finance ministry will have to bear the additional burden of Rs3 billion, says Ishaq Dar. PHOTO: RIAZ AHMED/EXPRESS
Government has decided to keep the prices of petroleum products unchanged for July, despite a surge in rates of crude oil in international markets.
“We have rejected the recommendation of the Oil and Gas Regulatory Authority (Ogra) for a price increase and have decided to keep the prices unchanged for the upcoming month,” Finance Minister Ishaq Dar said while speaking to media in Islamabad on Thursday.
“[As a result] The finance ministry will have to bear the additional burden of Rs3 billion."
OGRA recommends upward revision in oil prices
Ogra on Wednesday had recommended in a summary an increase of up to 19.9% in POL prices July onwards.
The government has the capability to absorb the impact of the proposed increase in oil prices by adjusting tax rates on petroleum products.
Despite a decline of over 50% in global prices, consumers have largely been denied a full relief due to hefty taxes.
The increase in tax rates comes as Pakistan continues to suffer from a revenue shortfall and a tax-to-GDP ratio that is one of the lowest in the region.
At present, two types of taxes are being charged from oil consumers including petroleum levy and general sales tax.
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