On July 02, 2024, the federal government announced significant changes to the import duties on key petroleum products as part of its fiscal strategy outlined in a notification issued by the Ministry of Finance’s Revenue Division.
Effective from July 01, 2024, the government has imposed a 10% regulatory duty (RD) on imports of Motor Spirit (petrol) and High-Speed Diesel oil.
Additionally, a 5% levy has been instituted on imports of White Oil and Natural Gas. These measures are slated to remain in effect until June 30, 2025, unless otherwise revoked.
The decision to levy these duties is part of a broader effort to bolster tax revenues, aiming to achieve a daunting target of Rs13 trillion for the fiscal year 2024-2025.
This fiscal approach includes applying increased RD rates to a total of 657 luxury and non-essential items, reflecting the government’s strategy to generate additional revenue streams while managing fiscal deficits.
Concurrently, the government has adjusted retail prices for petroleum products in response to global market dynamics. Petrol prices have risen by Rs7.45 per litre, bringing the new price to Rs265.61 per litre.
Similarly, the price of High-Speed Diesel (HSD) has been increased by Rs9.56 per litre, now priced at Rs277.45 per litre for the current fortnight.
These adjustments in duties and prices underscore the government’s efforts to navigate economic challenges and ensure sustainability in revenue collection amid fluctuating global energy markets. The strategic imposition of import duties on key fuels and the subsequent adjustment of retail prices are intended to balance fiscal imperatives with the needs of consumers, while also addressing broader economic goals set for the fiscal year ahead.
