The IMF and Pakistan have agreed on strict conditions for energy and tax reforms for the next fiscal year’s budget, under which the petroleum levy target has been set at Rs 1.73 trillion.
According to the report, the levy target is likely to be exceeded in the current year as well, while it will be increased further next year, as a result of which the average levy is likely to reach about Rs 100 per litre.
It has also been decided to limit subsidies in the energy sector to Rs 830 billion, which is a significant decrease compared to last year.
The government has assured the IMF that electricity and gas tariffs will be adjusted periodically according to full cost, while subsidies to the low-income group will be provided through the Benazir Income Support Program.
According to experts, these reforms are important to reduce fiscal deficits in the energy sector, but inflationary pressure on ordinary consumers may increase.
We welcome your contributions to The Pakistan Observer, Submit your blogs, articles, press releases, news story pitches and news features.
Please send your submissions to our News Room or Editorial team.
