Govt to Slap Levy and 17% GST on Petroleum Products from July 1

The government has agreed with the International Monetary Fund (IMF) on a schedule to increase the prices of petroleum products by imposing a 17 percent general sales tax (GST) and petroleum development levy (PDL) of Rs. 50 per liter during the fiscal year 2022-23 (FY23).

Sources said that the government and IMF have agreed on a schedule to impose GST and PDL on petroleum products from 1st July 2022 to June 2023 for the revival of the stalled loan program.  According to the schedule, the petroleum levy will be increased by Rs.5 per liter each month.

According to the schedule, the government will charge 17 percent GST and Rs. 5 per liter PDL on petroleum products in July 2022. The GST will remain at 17 percent for the remained of the fiscal year while the PDL will increase by Rs. 5 per liter each month.

Under the agreed terms, the PDL for the month of July will be Rs. 5 per liter, Rs. 10 per liter for August, Rs. 15 per liter for September, Rs. 20 per liter for October, Rs. 25 per liter for November, Rs. 30 per liter for December, Rs. 35 per liter for January 2023, Rs. 40 per liter for February 2023, Rs. 45 per liter for March 2023, and the levy will reach Rs. 50 per liter in April 2023.

However, sources added that the GST collection might be suspended if prices of petroleum products and crude oil rise further in the international market to provide relief to the public.

The schedule indicates that the government will increase the prices of petroleum products on July 1, 2022, to implement the conditions of the IMF.