Petroleum Levy Set for Hike in Government’s New Budget Proposal

To raise more money, the federal government will end the maximum level for the Petroleum Development Levy (PDL) and set the rate above Rs. 100 per liter for the next fiscal period of 2025-26.
ProPakistani received information that the rate of PDP will be raised in opposition to the present cost of Rs. 78 per liter of petrol and diesel to assist the FBR in earning additional funds.
This would be the greatest oil levy the country has imposed and is much higher than the estimated collection of Rs 1,117 billion this fiscal year.
Money from the levy will also be used to provide subsidies for the power industry and electric vehicles.
After July 2024, the government raised the PDL from Rs. 60 to Rs. 78 per liter, resulting in over Rs. 1 trillion in tax revenue in just the first 10 months of the current fiscal year.
The expected amount of PDL revenue for the government this year is more than Rs. 1,100 billion. Rs. 833.847 billion has been collected by the government in the petroleum levy, which covers July 2024 to March 2025. In other words, total collections were Rs. 1,019 billion during FY24 and Rs. 580 billion in the previous year, FY23.
It has been reported that the government and the IMF agreed to eliminate the cap on the Debt Service Surcharge, which right now restricts it to 10 percent of power companies’ expected revenue.
IMF reports on Pakistan also state that the federal government will legislate the removal of the DSS cap by June 2025. It stated that Islamabad aims to end circular debt and reach net-zero by fiscal year 2025 by adjusting rates, providing subsidies, and obtaining cost savings.