Pakistan Fuel Price Hike: PPDA and SCBA Slam New Petroleum Levies
The Pakistani government’s latest adjustment to fuel pricing has sparked a wave of criticism from key industry stakeholders and legal bodies. Effective May 9, new petroleum levies have been imposed across various fuel grades, leading the Pakistan Petroleum Dealers Association (PPDA) and the Supreme Court Bar Association (SCBA) to warn of increased public hardship and severe financial strain on fuel retailers.
Breakdown of New Petroleum Levies
Under the official notification, the government has introduced significant levies on both standard and premium fuels. The following table outlines the specific charges per litre:
| Fuel Type | Levy (Per Litre) |
|---|---|
| Petrol | Rs117.41 |
| High-Speed Diesel | Rs42.60 |
| Premium Grades (97 RON, 95 RON, HOBC) | More than Rs305.37 |
| Kerosene | Rs20.36 |
| Light Diesel Oil | Rs15.84 |
| Furnace Oil | Rs77 (Equivalent to Rs82,077 per tonne) |
Retailers Face “Negative” Cost of Business
The Pakistan Petroleum Dealers Association (PPDA) argues that the government is prioritizing indirect taxes over public relief during a period of rising inflation. PPDA Vice Chairman Raja Waseem Shehzad stated that these heavy levies have rendered petroleum products unaffordable for the average consumer, which in turn has led to declining sales and financial losses for station owners.
A critical point of contention for retailers is the structure of their earnings. Mr. Shehzad highlighted that the government continues to use a fixed amount per litre for commissions rather than a percentage-based system. He noted: “At the same time, the government has not fixed petroleum dealers’ commission on a percentage basis instead of a fixed amount per litre sale, meeting the cost of doing business is going in the negative.”
Beyond the levies, fuel station owners are grappling with rising operational overheads, specifically citing increased electricity tariffs and other charges as factors that are squeezing their margins.
Legal Community Warns of Inflationary Pressures
The Supreme Court Bar Association (SCBA) has also joined the protest, expressing grave concern over the price hikes. In a statement issued by SCBA President Haroonur Rashid, Secretary Malik Zahid Aslam Awan, and members of the association’s 28th executive committee, the group asserted that the price increases have aggravated the hardships faced by the general public and contributed to broader inflationary pressures.
The SCBA is calling for immediate government intervention, urging the federal administration to:
- Roll back the recent increase in petrol and diesel prices.
- Introduce relief measures to reduce electricity tariffs.
- Lower the prices of essential commodities.
Key Takeaways
- New Levies: Significant increases in petroleum levies took effect on May 9, with premium fuels seeing the highest impact at over Rs305.37 per litre.
- Retailer Distress: The PPDA warns that fixed commissions and rising electricity costs are making the fuel retail business unsustainable.
- Economic Impact: The SCBA views the hike as a driver of inflation and a source of increased public hardship.
- Demands: Both organizations are urging the government to cut duties and roll back prices to provide economic relief.
As the fuel retail sector faces declining sales and the public contends with rising costs, the pressure on the federal government to reconsider its tax strategy on petroleum products continues to mount. The outcome of these demands will likely determine the short-term stability of the fuel retail market and the trajectory of inflation for essential goods.