Petrol and diesel prices in Pakistan are expected to rise significantly from November 16 following the International Monetary Fund (IMF) proposal.
The IMF has proposed imposing a General Sales Tax (GST) on petroleum products and increasing the Petroleum Development Levy (PDL) from Rs60 to Rs70 per litre.
According to sources, if the government agrees to these recommendations, petrol and diesel prices could see a steep hike starting November 16, adding to the burden on consumers already grappling with inflation.
This anticipated increase would mark the second consecutive fortnightly adjustment to fuel prices amid ongoing IMF-mandated reforms.
Current petrol, diesel prices in Pakistan
The latest price hike on October 31 pushed petrol prices up by Rs1.35 per litre, setting the new rate at Rs248.38 per litre. High-speed diesel (HSD) saw a more substantial increase of Rs3.85, now priced at Rs255.14 per litre.
These adjustments were implemented to align with international oil prices and the government’s fiscal targets.
Currently, petroleum products are exempt from GST, while the PDL stands at Rs60 per litre.
However, if the new tax measures are introduced, fuel costs are expected to surge, affecting transport costs and potentially impacting inflation across various sectors.
Economic implications
The government’s negotiations with the IMF come amid an effort to stabilize Pakistan’s fragile economy. The IMF’s call for enhanced revenue generation through increased fuel levies and GST is part of a broader strategy to reduce fiscal deficits.
