The federal government has decided to keep fuel prices unchanged by increasing the petroleum levy on petrol and diesel. Instead of lowering prices, the government has raised the levy by Rs. 10 per liter, bringing it up from Rs. 60 to Rs. 70 per liter. This step was taken to meet the conditions set by the International Monetary Fund (IMF).
Why the Levy Was Increased
According to sources, the IMF had specifically asked for this Rs. 10 per liter hike as part of its loan program. The decision to increase the levy was necessary to secure the next loan installment from the IMF, helping the government manage its revenue shortfalls.
Financial analysts, including Muhammad Sohail, CEO of Topline Securities, have stated that this move was essential to bridge tax revenue gaps. Instead of reducing fuel prices, the government has chosen to generate additional funds by raising the levy.
Impact on Consumers
This decision means that despite the possibility of lower fuel prices, the public will not see any relief at the pump. Instead, consumers will continue paying the same high prices for petrol and diesel. The government, however, is considering providing relief in electricity bills, but that will also be funded through taxes collected from the people.
Economic Considerations
The government is under pressure to meet its financial obligations while following IMF directives. Increasing the petroleum levy allows authorities to maintain revenue levels, ensuring compliance with international financial agreements. However, this move also keeps the financial burden on the public, as fuel costs remain unchanged.
Final Thoughts
While the government’s decision secures IMF funding, it comes at the cost of keeping fuel prices high for ordinary citizens. With inflation already affecting daily expenses, many people were expecting relief in fuel prices. However, with the increase in petroleum levy, that relief has been postponed. The coming weeks will show how this decision impacts the economy and whether the government introduces other measures to balance the financial burden on the public.
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