ISLAMABAD: Based on existing high tax rates, the Oil and Gas Regulatory Authority (Ogra) recommended on Wednesday up to 13 per cent increase in the prices of all petroleum products for April.
In a summary sent to the government, Ogra reported increase in the international oil prices this month that needed to be passed on to consumers if the taxes were not reduced.
The crude prices in the Middle East, the source of the country’s oil imports, increased by about $5 per barrel to $41 in the later part of March.
Ogra recommended an increase of 4.89pc in the price of petrol, 2.13pc in high speed diesel (HSD), 6.40pc in high octane blending component (HOBC), 12.85pc in light diesel oil (LDO) and 9.17pc in kerosene.
An official said the prices could be brought down by up to 50pc if the general sales tax rate was revived to the normal 17pc but the government would continue to offset losses in revenue collection through the highest-ever taxes on petroleum products.
In the first eight months of the current financial year, the government jacked up around Rs92 billion additional revenue.
Ogra forwarded its working paper to the government on the basis of existing tax rates under instructions from Finance Minister Ishaq Dar.
The decision about the adjustment in oil prices would be announced after approval of the prime minister, an official said.
Based on the tax rates and Pakistan State Oil’s purchases from international market, Ogra worked out an increase of Rs3.07 per litre in the ex-depot price of petrol to Rs65.84 from Rs62.77. The sale price of the HSD would increase by Rs1.52 to Rs72.64 per litre, LDO by Rs4.88 to Rs42.85, HOBC by Rs4.65 to Rs77.27 and kerosene by Rs3.97 to Rs47.22.
The government is collecting about Rs25 per litre on petrol in a fixed sales tax of Rs14.58 and Rs10 as petroleum development levy. About Rs38 is collected per litre on HSD, including sales tax of Rs29.57.