The Finance Ministry on Monday said that Rs 120 billion revenue estimated on account of Petroleum Levy for 2012-13 is achievable as declining petroleum prices in the international market have enabled the government to charge optimum levy rate on different petroleum products.
Advisor to Ministry of Finance Rana Asad Amin and Secretary Planning Commission, Asif Bajwa said reduction in PL rate in the face of rising petroleum prices in the international market resulted in downward revision of revenue collection on this account to Rs 69 billion last year. They said that rate of PL was reduced to provide relief to common man against rising prices of petroleum products in the international market.
The officials said that a fixed amount of Rs 10 on diesel and Rs 8 on petrol was being collected which was slashed by the government against rising prices of petroleum products in the international market. They said that decreasing prices of petroleum products in the international market would enable to charge full rate of petroleum levy from consumers.
Senator Ishaq Dar said this means that the government would not pass on to the consumers' benefit of lowering prices of petroleum products in the international market. The senator committee's recommendation, which was withdrawn after opposition from the Ministry of Finance, was that income from PL for 2012-13 may be reduced to Rs 70 billion from estimated Rs 120 billion in the budget. The Ministry of Finance opposed the proposal that reduction in petroleum levy would either increase government borrowing or deficit for the next fiscal year and the target seems achievable due to lowering petroleum prices in the international market.
The Senate Standing Committee on Finance on Monday recommended that all international loans and economic agreements should be presented before ratification by the Parliament. The committee also recommended that the State Bank of Pakistan may work out a protocol in consultation with banks to make it obligatory for banks - both local and foreign to spend at least 5 percent of their profit for the promotion of education and health services in the country.
The committee also recommended to the National Assembly that State Bank of Pakistan may accelerate its efforts towards promotion of Islamic banking and finance in the country in order to eliminate Riba and economic exploitation as stipulated in Article 38 (1) of the Constitution.
The federal government has been asked to announce subsidised long-term fixed mark-up loans to set up new industrial units in the country to promote industrialisation. The Standing Committee on Finance also recommended to the National Assembly that the federal government may allocate funds for Balochistan Solar Energy Schemes which are already approved by P&D.