Landed cost of Petrol is Rs 200, public bears Rs 140 in taxes: Miftah Ismail

KARACHI: Awam Pakistan Party Secretary-General and former finance minister Miftah Ismail stated that the landed cost of petrol at the port is Rs 200, ARY News reported.

Discussing petroleum prices and associated levies, Ismail noted that while petrol costs Rs 200 at the port, the public pays an additional Rs 140 in government taxes. This includes a levy of Rs 105 and a custom duty of Rs 20.

The Awam Pakistan Secretary-General pointed out that while the standard general sales tax (GST) on commodities in Pakistan is 18 percent, the levy on petrol reaches up to 40 percent, alongside the mandatory Rs 20 custom duty.

He asserted that when a government fails to tax the wealthy, feudal lords, and the real estate sector, the entire financial burden falls on the middle and salaried classes.

The former minister highlighted that when a wealthy individual purchases a Mercedes, they pay only an 18 percent sales tax. In stark contrast, a common citizen pays between Rs 125 and Rs 130 in taxes per litre of petrol, equating to a 40 percent tax rate.

Criticizing the federal administration, he stated that the government made poor decisions by raising prices and propagating a narrative of a potential oil shortage.

He opined that any localized oil shortage could have been effectively managed through administrative measures.

Further lambasting the administration, Ismail claimed that when disputes arise between consumers and corporations, the government consistently favors corporations. He cited the sugar industry as an example, noting that prices are routinely manipulated upward—first through exports and subsequently through imports from mill owners.

He called it unfortunate that the government consistently prioritizes the interests of investors, stockists, and corporations while neglecting the general public.

Ismail advised the government to refrain from installing additional power projects with Independent Power Producers (IPPs) and to stop issuing government guarantees.

He revealed that, according to official information, new projects are being made to generate an additional 14,000 MW of electricity. He questioned the logic of producing more power when the country already has a surplus that cannot be sold.