Consumers may face higher fuel costs in the upcoming fiscal year as the government is planning to increase the carbon levy on petroleum products, sources involved in the budget-making process told ProPakistani.
Under the proposal, the carbon levy will be raised from Rs. 2.50 per litre to Rs. 5 per litre beginning July 1, 2026, as part of the federal budget measures for the next financial year.
Sources said the current fiscal year’s budget imposed a carbon levy of Rs. 2.50 per litre on petroleum products. The upcoming budget is expected to increase the charge to Rs. 5 per litre, effectively doubling the levy.
The revised rate will apply to petroleum products from the start of the new fiscal year and is expected to increase government revenue while supporting climate-related policy commitments.
Sources further noted that the current budget had already envisaged a carbon levy of up to Rs5 per litre, and the government is now preparing to implement the full amount in the next fiscal year.
The proposed increase is expected to be formally announced as part of the federal budget for FY2026-27.
The image for this story was generated with AI. The lawmakers here weren’t really holding fuel fillers in their hands.