Going up: Govt imposes petroleum levy on LPG once again
Price of the fuel expected to surge by 10% to an all-time high.
ISLAMABAD:
The federal government has imposed petroleum levy, a type of tax, of Rs11,486 per ton on locally produced Liquefied Petroleum Gas (LPG) - a move that is likely to raise prices by 10% - according to a notification on Monday.
The price is expected to take retail prices to a record high of at least Rs155 per kg from the current average price of Rs140 per kg.
LPG Association of Pakistan (LPGAP) alleged that the Ministry of Petroleum and Natural Resources has circumvented the court’s orders and the suspension of the LPG Policy 2011 through an amendment to the Petroleum Products (Petroleum Levy) Ordinance, 1961.
The government’s decision to deliberately raise prices, which are already equated with Saudi Arabian export prices, is flawed, said LPG Association of Pakistan (LPGAP) spokesperson Belal Jabbar.
“We intend to bring this regrettable development to the attention of the court,” Jabbar added.
The petroleum levy was initially imposed in September 2011 through the LPG Policy 2011, however, it was suspended in weeks by the Lahore High Court.
Petroleum Secretary Ijaz Chaudhry told The Express Tribune that imposition of the levy was suspended earlier on the pretext that it was not imposed by an Act of Parliament.
Now that it is through an Act, it can be imposed, added Chaudhry.
The new tax is expected to raise retail prices by at least 10% immediately and is likely to be challenged in court, says LPGAP in a statement issued on Tuesday.
The LPG industry maintains that the policy was crafted to secure the financial viability of Progas LPG import facility, which was controversially purchased last year by Sui Southern Gas Company Limited.
The country’s eleven LPG producers are expected to pass the additional cost to end-consumers. The government is the largest producer of LPG in the country by virtue of its shareholdings in Pak-Arab Refinery Company, Oil & Gas Development Company and Pakistan Petroleum Limited among others.
After imposition of the petroleum levy, LPG, which was being used as a replacement fuel for natural gas, has now become the most expensive fuel in terms of energy content per rupee.
Published in The Express Tribune, January 18th, 2012.
The federal government has imposed petroleum levy, a type of tax, of Rs11,486 per ton on locally produced Liquefied Petroleum Gas (LPG) - a move that is likely to raise prices by 10% - according to a notification on Monday.
The price is expected to take retail prices to a record high of at least Rs155 per kg from the current average price of Rs140 per kg.
LPG Association of Pakistan (LPGAP) alleged that the Ministry of Petroleum and Natural Resources has circumvented the court’s orders and the suspension of the LPG Policy 2011 through an amendment to the Petroleum Products (Petroleum Levy) Ordinance, 1961.
The government’s decision to deliberately raise prices, which are already equated with Saudi Arabian export prices, is flawed, said LPG Association of Pakistan (LPGAP) spokesperson Belal Jabbar.
“We intend to bring this regrettable development to the attention of the court,” Jabbar added.
The petroleum levy was initially imposed in September 2011 through the LPG Policy 2011, however, it was suspended in weeks by the Lahore High Court.
Petroleum Secretary Ijaz Chaudhry told The Express Tribune that imposition of the levy was suspended earlier on the pretext that it was not imposed by an Act of Parliament.
Now that it is through an Act, it can be imposed, added Chaudhry.
The new tax is expected to raise retail prices by at least 10% immediately and is likely to be challenged in court, says LPGAP in a statement issued on Tuesday.
The LPG industry maintains that the policy was crafted to secure the financial viability of Progas LPG import facility, which was controversially purchased last year by Sui Southern Gas Company Limited.
The country’s eleven LPG producers are expected to pass the additional cost to end-consumers. The government is the largest producer of LPG in the country by virtue of its shareholdings in Pak-Arab Refinery Company, Oil & Gas Development Company and Pakistan Petroleum Limited among others.
After imposition of the petroleum levy, LPG, which was being used as a replacement fuel for natural gas, has now become the most expensive fuel in terms of energy content per rupee.
Published in The Express Tribune, January 18th, 2012.