ISLAMABAD, Jun 30 (APP):Federal Minister for Finance and Revenue, Miftah Ismail justified the price-hike made by the government in the petroleum products, citing deviation from the agreement with the International Monetary Fund (IMF) by the Pakistan Tehreek-i-Insaf (PTI) government as one of the key reasons.
Addressing a press conference along with Minister of State for Petroleum Dr Musadik Malik, the minister said that the incumbent government had to honour commitments made with IMF by the previous regime, which had abandoned the agreement after a no-confidence motion was initiated against it.
He said, had the previous government continued the agreement, there would have been a gradual increase in the Petroleum Development Levy (PDL) and sales tax.
However, he added, since the PTI government broke a deal with IMF, the incumbent government had to start from the stage it was left. Consequently, it had to fix some PDL and sales tax.
He said, had the programme been continued, the petroleum levy should have been Rs70 tax each on diesel and petrol, however, the government imposed only Rs5 and Rs.10 on diesel and petrol respectively.
The minister said, the government had increased petrol prices by Rs 4.85 and imposed Rs1.0 PDL on it, hence increasing the prices by Rs.14.85 whereas there had been increase of Rs8.23 on diesel with a 5 per cent tax. Likewise, there has been only a 5 per cent increase each in the prices of kerosene and light diesel oil.
Accordingly, the prices of petrol have been increased from Rs233.89 per litre to Rs.248.74 per litre, high-speed diesel from Rs263.31 to Rs276.54 an increase of Rs13.23 per litre while Kerosene oil prices have been increased by Rs18.83 per litre, from Rs211.43 to Rs230.26 whereas the price of light diesel oil has been increased by Rs18.68 per litre, from Rs207.47 to Rs226.15.
“Increasing the prices, was not an easy decision but we had to do it in compulsion,” the minister added.
He said that there was a record tax collection by the Federal Board of Revenue, which had also exceeded the target of Rs61000 billion set by the previous government.
In addition, he said, the board government had paid all the processed duty Drawback of Local Taxes and Levies (DLTL) pending for the last three years. As per Prime Minister Shehbaz Sharif’s instructions, a few days ago we paid all processed DLTL claims pending for the last three years, he added.
He said, the board also paid all processed Faster, Sales Tax, Income Tax and Export Rebate claims that were due. Every single processed claim has been paid.
The minister said that with successful negotiations, the programme with IMF has reached a positive stage and the fund had recently issued a memorandum of economic and financial policies (MEFP).
He said, according to the policy, there are some prior conditions which included an increase in PDL and overcoming losses, which were recorded at Rs233 last year.