ISLAMABAD: Costs of main oil merchandise are set to move past three-yr excessive, with diesel crossing Rs100 per litre mark – highest since November 2014 – amid rising worldwide costs and falling rupee worth.
Nevertheless, the federal government has the cushion to soak up the estimated improve partly by bringing down the 31 per cent common gross sales tax fee on excessive-velocity diesel (HSD) in view of its direct psychological impression on inflation and transportation prices, an official defined.
Presently, the federal government is charging 31pc GST on HSD and 17pc on different merchandise along with Rs8 per litre petroleum levy on HSD, Rs10 per litre on petrol and Rs6 and Rs3 per litre on kerosene and lightweight diesel oil (LDO) respectively.
Based mostly on present tax charges and import costs reported by Pakistan State Oil (PSO), the Oil and Fuel Regulatory Authority (Ogra) on Tuesday labored out a rise of Rs10.25 per litre within the costs of HSD and Rs2.ninety eight per litre in motor gasoline (petrol) for February.
The regulator additionally advisable Rs12.seventy four and Rs11.seventy two per litre improve within the costs of kerosene and LDO respectively.
Nevertheless, oil corporations can be at will to set the top worth of HSD after deciding the quantum of margins for themselves and the sellers in view of a current authorities choice to decontrol diesel charges.
As such, if the regulators’ calculations are accepted by the prime minister, the worth of HSD would go up by eleven.4pc, kerosene by 19.8pc, LDO by 20.1pc and petrol by three.7pc.
In a abstract despatched to the federal government, Ogra maintained that the adjustment in costs of petroleum merchandise was required to cross on the impression of fluctuation in worldwide oil costs and the rupee towards US greenback throughout January as crude priced touched $70 a barrel.
Subsequently, on the idea of present tax charges and imported value of PSO, Ogra calculated the brand new ex-depot worth of HSD at Rs100.sixteen per litre as an alternative of present fee of Rs89.ninety one per litre. That is the very best HSD price since November 2014.
For petrol, the ex-refinery worth was labored out at Rs84.fifty one per litre as an alternative of present price of Rs81.fifty three per litre, highest since December 2014.
Likewise, Ogra calculated ex-refinery worth of kerosene at Rs77.06 per litre – highest since July 2015 – towards present fee of Rs64.32 per litre, displaying a rise of Rs12.seventy four or 19.8pc. Additionally, it proposed Rs11.seventy two per litre improve within the worth of LDO to Rs70.09 – highest since August 2015 – as an alternative of present price of Rs58.37, up 20.1pc.
The abstract has been forwarded to the petroleum division that might search its approval from the prime minister. Underneath the apply in vogue, oil costs are revised on the final day of each month.
The erstwhile Ministry of Petroleum beneath the minister-ship of Shahid Khaqan Abbasi and Ogra have been recommending for nearly two years a considerable improve within the costs of kerosene oil and LDO to minimise an enormous worth differential with petrol.
The ministry believed that a Rs30 per litre worth differential between petrol and the 2 different merchandise was encouraging dishonest market operators to combine kerosene oil with petrol for larger income and leading to adulterated and poor high quality petrol out there as an alternative of upper grade (92RON) being charged to shoppers.
Prime minister Abbasi has been permitting gradual improve within the worth of LDO and kerosene that former prime minister Nawaz Sharif stored unchanged at Rs44 per litre for nearly 4 years ‘to guard poor individuals’.
Apparently, kerosene is the one regulated petroleum product however unavailable at fastened charges anyplace within the nation whereas all different merchandise are deregulated and can be found fairly inside the worth band introduced by the federal government.
The petrol and HSD are two main merchandise that generate most of income for the federal government due to their large and but rising consumption within the nation. HSD gross sales throughout the nation at the moment are going past 800,000 tonnes per thirty days towards month-to-month consumption of round seven hundred,000 tonnes of petrol.
The gross sales of kerosene oil and LDO are usually lower than 10,000 tonnes per 30 days.
Revealed in Daybreak, January thirty first, 2018
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