The government is considering another increase in petrol-related taxes as part of efforts to boost revenue collection and comply with conditions set by the International Monetary Fund, according to sources within the Finance Ministry.
Officials indicate that petroleum levy collections are already projected to surpass the annual target of Rs. 1,468 billion. However, discussions are ongoing about further raising the levy in the coming months to strengthen fiscal performance and meet financial commitments.
This development follows a recent hike in the petroleum levy on petrol, which was increased by approximately Rs. 27 per litre, pushing it beyond Rs. 107 per litre. The adjustment was part of broader economic measures linked to Pakistan’s agreement with the IMF, aimed at improving revenue streams and reducing reliance on subsidies.
Sources reveal that the IMF has consistently urged Pakistan to phase out subsidies and shift toward direct taxation mechanisms, including higher petroleum levies, to ensure better fiscal discipline. In response, the government has reportedly assured the lender that it will continue implementing strict financial management policies to stabilize the economy.
In recent months, Pakistan has already experienced notable increases in fuel prices. While global oil market fluctuations and regional tensions have played a role, a significant portion of the rise in domestic petrol prices has been attributed to increased taxation rather than purely international price changes.
If the proposed measures move forward, consumers may face additional financial pressure, as higher petrol taxes typically translate into increased transportation and commodity costs across the economy.
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