Diesel increase to hit transport, farming, and food prices
Govt using fuel taxes as revenue tool at public expense: Mian Zahid Hussain
ISLAMABAD: The Chairman of National Business Group Pakistan, the President of the Pakistan Businessmen and Intellectuals Forum, the President of All Karachi Industrial Alliance, the Chairman of the FPCCI Advisory Board, and the President and former provincial minister, Mian Zahid Hussain, said on Wednesday that the recent surge in petrol and high-speed diesel prices, orchestrated by the federal government, is a ticking time bomb that will set off another round of inflation for the general public.
He stated that government policies are continually adding to the financial burden on citizens, making their lives difficult.
Mian Zahid Hussain noted that according to the federal finance ministry, petrol prices have increased by Rs 5.36 per liter. At the same time, the cost of high-speed diesel has risen by Rs 11.37 per liter. Under the new rates, petrol will be available at Rs 272.15 per liter and diesel at Rs 284.35 per liter.
Speaking to the business community, the veteran business leader underscored that the rise in petrol prices will directly hit the middle- and lower-income groups who rely on motorcycles, rickshaws, and small vehicles for their daily commute. Simultaneously, the soaring diesel prices will inflate transport costs, agricultural machinery expenses, and food prices, significantly impacting the masses and businesses.
The business leader expressed concern that the current increase was made on recommendations from OGRA and relevant ministries. Still, no serious steps are being taken to provide relief to ordinary citizens. Instead, their difficulties persist.
Mian Zahid Hussain revealed that in fiscal year 2024, the government collected Rs 1.161 trillion through the petroleum levy, while the current fiscal year target has been increased by 27 percent to Rs 1.470 trillion. He said this situation reflects that the government continues to use petroleum products as a significant revenue source, with the burden ultimately falling on the public.
He noted that petroleum products include an average distribution and retail margin of Rs 17 per liter, which is given to oil marketing companies and dealers, and further increases the overall price. He demanded that the government review its price increase policy and develop a comprehensive strategy to provide relief to the masses.
He warned that if this trend continues, inflation will increase further, leading to higher business costs, slower economic activity, and growing public unrest. Mian Zahid Hussain added that food items, educational expenses, household bills, and transport costs have already exceeded public tolerance and continuous fuel price increases will create severe financial pressure for the middle class.
The government should explore alternative paths instead of transferring the tax burden to lower-income groups, including expanding the tax base, seeking non-tax revenue sources, and implementing fiscal austerity in government expenditures.
He urged that without immediate corrective measures, rising petroleum prices will continue to erode household purchasing power and business viability. He demanded transparent pricing, a reduction in non-essential imports, and broader fiscal reforms, rather than repeatedly shifting the tax burden onto already struggling citizens.
