The federal government has increased the carbon tax on petrol and diesel by Rs5, according to reports on Thursday. The revised carbon tax will come into effect at 12 AM today.
Under the new rates, the carbon tax on petrol and diesel has been raised from Rs2.5 per litre to Rs5 per litre. In addition to this, the government has reduced the petroleum levy to offset the increase.
The details also state that a Rs5 carbon tax has been imposed on high octane fuel and furnace oil.
The actual impact of the higher carbon tax is expected to be reflected in the next announcement of petrol and diesel prices.
Earlier, on June 26, the government decided to keep petroleum prices unchanged. According to a notification issued by the Petroleum Division, petrol will continue to cost Rs299.50 per litre.
Additionally, high-speed diesel will remain at Rs311.47 per litre until the next price review.
Last week, Prime Minister Shehbaz Sharif announced a major reduction in fuel prices. Petrol prices were cut by Rs74 per litre.
It brought the price down from Rs373 to Rs299 per litre. The price of diesel was reduced by Rs67 per litre, from Rs378 to Rs311 per litre.
New petroleum prices stabilisation fund
Earlier this week, the federal government established a Petroleum Prices Stabilisation Fund to help keep petroleum product prices stable in the future.
The Ministry of Finance also issued an official notification confirming the creation of the fund.
According to the notification, the fund was established after receiving approval from the federal cabinet.
A separate account will be opened under the Public Account of the Federation to manage all financial matters related to the fund. All money allocated for the fund will be deposited into this account.
The Ministry of Finance, the Petroleum Division, and the Oil and Gas Regulatory Authority (OGRA) will jointly prepare the operating procedure for the fund.
The ministry said all necessary legal and financial approvals will be obtained before the fund becomes fully operational.
