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ISLAMABAD:
The government has increased levies on petrol by Rs 4.65 per liter and on diesel by 80 paisa per litre, thereby depriving the public of complete relief from falling fuel prices.
According to a notification issued on January 15 by the Petroleum Division, the levy on petrol has been increased from Rs79.62 to Rs84.27 per litre, while the levy on diesel has been increased from Rs75.41 to Rs76.21 per litre.
Petroleum tax on kerosene was increased by Rs 1.41 per liter, taking it from Rs 18.95 to Rs 20.36 per litre. The levy on light diesel has been fixed at Rs15.84 per litre.
Petroleum tax is a tax imposed by the government on petroleum products such as gasoline, high-speed diesel, kerosene and fuel oil. It is charged by the gallon and is collected by the federal government under the Petroleum Levy Ordinance of 1961.
The levy is not a sales tax; this is a fixed rate per liter, which the government can increase or decrease through notifications.
Everything the government collects from the oil tax goes directly to the federal treasury, unlike the sales tax which is shared with the provinces.
The oil tax constitutes a major source of revenue, especially when the government wishes to avoid increasing general taxes.
