ISLAMABAD, May 16: The Board of Investment (BoI) has proposed a gradual abolition of petroleum surcharge, asking the government to phase it out by 20 per cent each year starting from the current fiscal. Informed sources told Dawn on Tuesday that the BoI had made the suggestion to reduce the cost of doing business in the country.

It also proposed to the government to exempt the Total Parco Pakistan Ltd (TPPL) from tax for at least two years as had been done in case of Shell Pakistan and Pakistan State Oil in 1991 and 1992 when these Oil Marketing Companies (OMCs) were making losses.

In its budget proposals, the BoI said that TPPL and other OMCs should be allowed to compute the minimum income tax as percentage of gross margin (instead of turnover) on sale.

An official in the ministry of petroleum and natural resources, however, disagreed with the proposal saying that the petroleum surcharge, also called Petroleum Development Levy (PDL), had already been reduced to about Rs6 billion against Rs47 billion in 2003-04.