ISLAMABAD: The local producers and marketing companies of liquefied petroleum gas (LPG) have asked the government to remove the disparity in General Sales Tax (GST) and the petroleum levy between the locally produced LPG and the imported product.

In a letter to the petroleum division, the Pakistan Petroleum Exploration and Production Companies Association has stated that local LPG producers are paying petroleum levy and the government should charge regulatory duty for LPG import from sea route as well.

The local producers are paying petroleum levy of Rs4,669 per tonne whereas the government has scrapped regulatory duty on LPG imports. Despite the disparity in taxes, the LPG importers are selling at the same price of locally produced LPG even though they are enjoying several incentives.

The local LPG producers have also referred to a study by the Competition Commission of Pakistan that pointed out discrimination in the pricing regime for locally produced and imported LPG.

The association asked the government to end the discriminatory pricing regime that was exploiting consumers and may halt future investment.

It also said that local LPG producers were paying 17 per cent GST whereas importers were paying 10pc GST.

In a separate letter to the petroleum division, the Pakistan LPG Marketers Association has also asked the government to impose a uniform GST rate on both imported and locally produced LPG. It asked the government to reduce the GST on locally produced LPG to 10pc from the existing 17pc so that the fuel becomes cheaper and affordable for the residents of remote and far-flung areas who were not connected to the piped gas networks.

Published in Dawn, February 14th, 2021