ISLAMABAD, April 16: The government pockets over 40 per cent of the prices of petroleum products and consumers in the country are changed more than foreign airlines, it is revealed by official figures.
According to the Oil and Gas Regulatory Authority, government share in petrol price (Rs56.29 per litre) comes to about Rs24.38 per litre (over 43.3 per cent) against an ex-refinery price of Rs28.50.
The government share includes Rs13.86 per litre petroleum development levy, Rs7.34 sales tax, 88 paisa excise duty and Rs2.30 inland freight equalisation margin (IFEM).
Moreover, Rs1.59 and Rs1.82 per litre go to oil marketing companies and dealers.
The IFEM is a transportation cost that is indirectly used for maintaining a uniform sale price at 29 oil depots across the country, including far flung areas of Azad Jammu and Kashmir and the Northern Areas.
Similarly, the Rs62.77 per litre price of High Octane Blending Component (HOBC) contains only Rs29.24 ex-refinery price and government share comes to about Rs29.73 per litre or 47.4 per cent of the sale price.
The government charges Rs17.81 per litre on the HOBC as petroleum development levy, Rs8.19 as sales tax, 88 paisa as excise duty and Rs2.85 per litre as the IFEM.
Distribution margin of oil marketing companies in the HOBC is fixed at Rs1.77 and dealers’ margin at Rs2.03 per litre.
For kerosene, the government charges Rs4.29 per litre as sales tax and Rs1.75 per litre as the IFEM. There is no petroleum development levy, excise duty or dealers’ commission on it. However, oil marketing companies are paid 96 paisa per litre.
The ex-refinery price of kerosene is Rs25.87 and its sale price is Rs32.87 per litre. Almost same is the case with light diesel which is sold at Rs30.97 per litre at 29 depots.
Interestingly, the government charges Rs35.86 per litre for JP-1 to domestic airlines compared with Rs31.18 per litre it charges for it from foreign airlines and cargo and technical landing flights, owing to Rs4.68 per litre exemption on sales tax.
Similarly, the government charges higher rates from common consumers than direct sales to big consumers for petrol.
The ex-depot sale price of petrol for common consumers is Rs56.29 per litre while it is sold by oil marketing companies at Rs54.20 to bulk customers like the defence organizations, railways, Wapda, and other public sector companies and government departments.
Likewise, the sale price of the HOBC for common consumers is Rs62.77 per litre against Rs60.43 per litre being charged from the above mentioned entities.
Higher rates of petroleum products result in rise in the share of sales tax because it is calculated at the rate of 15 per cent of the total price.
