The Federal Board of Revenue has notified a lower rate of general sales tax on petroleum products to keep its prices competitive for consumers.
A sales tax SRO 183(I) of 2022 released on Thursday said the lowest GST rates were notified to pass minimum increase to consumers.
The standard GST rate is 17pc.
“In exercise of the powers conferred by clause (b) of sub-section (2) of section 3 of the Sales Tax Act, 1990, the federal government is pleased to direct that the following further amendment shall be made [with effect from] Jan 16, 2022, in its notification no. SRO 57(I)/2016, dated Jan 29, 2016,” the notification said.
The rate of GST has been reduced to 0.79pc on petrol, followed by 3.17pc on high-speed diesel (HSD), 5.30pc on kerosene and zero per cent on light diesel oil (LDO).
The previous rate was 2.5pc on petrol, 5.44pc on HSD, 8.30pc on kerosene and 2.7pc on LDO.
The government has a choice to completely or partially give up GST on petroleum products to contain rising oil prices.
On Jan 31, the government delayed the application of additional petroleum levy for a fortnight given the inflationary pressures, keeping the ex-depot prices of petroleum products unchanged for the time being.