FBR cuts sales tax on petroleum products to keep prices stable

KARACHI: The Federal Board of Revenue (FBR) on Tuesday notified a reduction in the sales tax rates on petroleum products.

The FBR issued SRO 726(I)/2021 to comply with the decision of the government for keeping the petroleum, oil lubricant (POL) prices intact by absorbing a hike in the prices through downward adjustment in the sales tax rates.

The sales tax rate on kerosene has been slashed to 10.07 percent from the earlier rate of 15.44 percent. Similarly, the sales tax rate on light diesel oil has been reduced to 3.67 percent from the previous level of 7.56 percent.

However, the sales tax rates on petrol and high-speed oil have been kept unchanged at 17 percent.

On May 31, 2021, Prime Minister Imran Khan had decided to maintain the prices of petroleum products to the level of May 17, 2021. The government has not increased the prices of petroleum products since April 16, 2021, by adjusting sales tax and petroleum levy so that there is no corresponding increase in the prices of the essential items and provide maximum relief to the common man.

From July 1, 2019, the government had imposed a flat sales tax rate of 17 percent through SRO 700(I)/2019. However, the first amendment was made through SRO 551(I)/2021 issued on May 09, 2021. The second amendment has been made with the latest notification.

Also Read

FBR mulls 7.5% tax on pensions from July 1

KARACHI: The government is considering to impose a 7.5% tax on pensions...