Daily Times

The federal government has slashed the general sales tax (GST) on supply of petrol to 6.84 percent from 10.54 percent. The Federal Board of Revenue (FBR) has issued SRO 1327(I)/2021 to revise the rates of sales tax on petroleum products.

According to the latest notification the new sales tax rates are: sales tax rate on petrol supply has been reduced to 6.84 percent from 10.54 percent; sales tax rate on high speed diesel (HSD) has been reduced to 10.32 percent from 11.64 percent. However, the rates of sales tax on supply of kerosene oil and Light Diesel Oil (LDO) have been kept unchanged at 6.70 percent and 0.20 percent.

The FBR previously notified the change in sales tax rates through SRO 1225(I)/2021 dated September 18, 2021. The government on September 30, 2021 announced an increase in petroleum prices due to significant rise in international oil prices. The government has defended the price hike in petroleum products.

In a press conference a day after the price hike announcement, Finance Minister Shaukat Tarin said that the government was absorbing the impact of the decade’s highest price-hike at international level to provide relief to people through various measures including direct food subsidy to the poor. The federal minister said that Covid-19 pandemic had triggered price hikes all across the globe, adding that since Pakistan was importer of some essential commodities, hence it was impacted too. He said that the government had not passed on all this impact to people.