Petroleum Development Levy: Will the govt further burden the people or absorb the increase?
Business
It can increase it one go or in increments or even delay imposing it
ISLAMABAD (Web Desk) – Will the government go for imposing the Petroleum Development Levy (PDL) right now is the million-dollar question currently puzzling not only the experts but also the consumers who want some respite amid the alarming inflation.
There are those who think the government will opt for the pleasing the International Monetary Fund (IMF) as increasing the PDL was one of the conditions for Pakistan and the government did oblige it by getting the necessary legislation passed by the National Assembly.
Hence, the government is now empowered with effect from July 1, 2023 to jack up the PDL by amending the Petroleum Products (Petroleum Levy) Ordinance, 1961 through the Finance Act 2023-24.
So the levy of petroleum products can now reach Rs60 per litre against the previous level of 50.
But wait! There are also political considerations and the genuine desire to provide some relief to the masses or at least not to burden them further. That’s why there are reports that the petrol and diesel prices may be slashed by up Rs10.
So what are the options for the government?
1) Increase the PDL by Rs10 in one go
2) Incremental surge
3) Delay the imposition
If the government opt for the first two choices, then POL prices will increase – certainly not a good optics.
However, the government, still has a way out. It can cover the increase in prices by subsidising it and thus consumers won’t be burdened by the move.
But whether the government resort to the third option is to be seen as there are just around 33 hours left before we hear about the actual action through the fortnightly announcement made by Finance Minister Ishaq Dar tomorrow [June 30]. July 1 isn’t far away.
