Finance Minister Aurangzeb says a carbon levy of Rs2.5 per litre will be imposed on petrol, high-speed diesel and furnace oil
ISLAMABAD: (UrduPoint/Pakistan Point News-June 10th, 2025) The federal government on Tuesday announced the imposition of a petroleum and carbon levy on furnace oil, petrol, and high-speed diesel, as part of its broader fiscal and environmental reforms introduced in the new federal budget.
Presenting the budget for the fiscal year 2025–26, Federal Finance Minister Muhammad Aurangzeb said a carbon levy of Rs2.5 per litre will be imposed on petrol, high-speed diesel, and furnace oil. The levy will be gradually increased to Rs5 per litre by 2026–27.
The finance minister also unveiled several tax enforcement measures, including the confiscation of goods without tax stamps or barcodes. To strengthen compliance with tax regulations, provincial officers will be engaged in enforcement efforts, with a particular focus on curbing the smuggling of non-duty-paid cigarettes.
A proposal has also been made to allocate Rs16.29 billion for the National Assembly, including Rs. 5.08 billion for the salaries and allowances of parliamentarians.
As part of the government's commitment to structural reforms, customs procedures will be overhauled, and a 10 percent surcharge will be imposed to help address the growing circular debt. The government will retain the authority to revise the surcharge rate if needed.
Aurangzeb said the new budget prioritizes the implementation of the National Electric Vehicle Policy. He emphasized that electric vehicles will be promoted over petrol and diesel-powered vehicles, with specific incentives aimed at increasing the use of electric motorcycles and rickshaws.
A levy on fuel-powered vehicles has also been proposed. The sale and import of such vehicles will be subject to a levy based on engine capacity, aiming to discourage reliance on fossil fuels and promote environmentally sustainable alternatives.
