ISLAMABAD: Based on existing tax rates, the Oil and Gas Regulatory Authority (Ogra) calculated on Tuesday a reduction in prices of petrol and high-speed diesel (HSD) and an increase in other major petroleum products for the month of October.
It said the prices of all products could come down significantly if tax rates were reverted to normal budgeted position because their prices in the international market had declined in September.
Based on the existing tax rates and PSO purchases from the international market, Ogra worked out a reduction of 15 paisa per litre in the ex-depot price of petrol to Rs73.61 from Rs73.76.
The government is currently charging Rs24.92 per litre as taxes — Rs15 as GST and Rs9.92 as petroleum levy.
Ogra said petrol price could come down by Rs6 per litre if calculated on the basis of a fall in the international market.
The regulator calculated the price of high-speed diesel at Rs79.39 per litre, a reduction of Rs2.65, from Rs82.04 if the current tax rates were kept unchanged.
The government is collecting Rs33.30 per litre taxes on HSD — Rs25.46 as GST and Rs7.84 as petroleum levy.
Ogra said HSD price could come down by Rs16 per litre based on the international price fall in September.
It said the prices of three other products — kerosene, high octane blending component (HOBC) and light diesel oil (LDO) — could come down by Rs7 to Rs10 per litre on the basis of their decline in the international market.
The prices of these products were, however, proposed to be increased on the basis of existing tax rates.
As a consequence, the ex-depot price of kerosene was calculated at Rs60.10 per litre, an increase of Rs2.99, from Rs57.11.
The government is charging Rs13.18 per litre as GST and Rs5.92 as petroleum levy on kerosene.
Ogra worked out an increase of Rs2.63 per litre in the price of HOBC to Rs82.42 from Rs79.79.
The government is collecting Rs15.44 per litre as GST and Rs13.89 as petroleum levy on it.
The regulator calculated LDO price at Rs56.10 per litre, up by Rs2.51, from Rs53.59.
A senior official said the government had passed on partial relief to consumers last month by increasing tax rates and the same strategy would be followed this time as well.
He said the finance ministry would like to keep the prices of all products unchanged to have price stability and earn higher revenue yield through higher tax recovery on high price diesel.
Petrol and high-speed diesel are two major products that generate most of the revenue from the oil sector.
The monthly sale of HSD across the country stands at over 600,000 tonnes, petrol at about 400,000 tonnes and HOBC and kerosene at less than 10,000 tonnes.
A final decision on how much relief to be passed on to consumers would be taken by the prime minister on the advice of the finance ministry and the Federal Board of Revenue, the official said.
Published in Dawn September 30th, 2015