Senate proposes massive increase in petroleum levy on high octane fuel

ISLAMABAD: The Senate Standing Committee on Finance and Revenue has proposed a significant hike in the petroleum development levy (PDL) on high octane fuel, recommending an increase to Rs100 per litre.

The committee meeting, chaired by Senator Saleem Mandviwalla, convened on Friday to discuss various financial matters. During the session, an official from the Petroleum Division provided insights into the deliberations regarding petrol subsidies and usage patterns.

The official disclosed that extensive consultations were conducted with stakeholders last year to explore the feasibility of subsidising petrol for motorcyclists.

However, it was determined that such a subsidy would not be practical in Pakistan. The official noted that over 50 percent of the petrol consumed in the country is used by motorcyclists.

Additionally, the government has put forward a proposal to raise the PDL on high octane fuel from the current Rs60 to Rs75 per litre. Senator Mohsin Aziz, in response, inquired about the demographic that typically uses high octane fuel. The Petroleum Division official clarified that high octane is predominantly used by the affluent class.

Senator Mohsin Aziz asserted that wealthy individuals could afford the increased levy, suggesting that a PDL of Rs100 per litre on high octane fuel would be appropriate. This sentiment was echoed by the committee chairman, who endorsed the proposed increase to Rs100 per litre.

The recommendations from the Senate Standing Committee on Finance and Revenue will now be considered for implementation, aiming to adjust the fiscal policy on petroleum products in line with economic needs and social equity.

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