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ISLAMABAD:
The government has increased tax on petrol by Rs 4.65 per liter and on diesel by 80 paise per litre, effectively depriving the public of full relief from falling fuel prices.
According to a notification issued on January 15 by the Petroleum Division, tax on petrol has been increased from Rs 79.62 to Rs 84.27 per litre, while tax on diesel has been increased from Rs 75.41 to Rs 76.21 per litre.
The petroleum tax levied on kerosene has been increased by Rs 1.41 per liter from Rs 18.95 to Rs 20.36 per liter. The tax on light diesel has been fixed at Rs 15.84 per litre.
Petroleum tax is a tax imposed by the government on petroleum products such as gasoline, high-speed diesel, kerosene and furnace oil. It is charged per liter and is collected by the federal government under the Petroleum Tax Ordinance 1961.
The levy is not a sales tax; This is a fixed charge per liter, which the government can increase or decrease through notifications.
Everything the government collects through the oil tax goes directly to the federal treasury, unlike the sales tax that is shared with the provinces.
The oil tax is an important source of revenue, especially when the government wants to avoid raising general taxes.
