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Pakistan recorded its highest-ever petroleum levy collection in the first half of a fiscal year, as revenues surged to Rs 822.93 billion during July–December 2025. The sharp rise reflects higher levy rates on petrol and diesel, pushing the tax burden on fuel to over Rs 100 per litre for consumers.
According to official documents, petroleum levy collections increased by Rs 273.51 billion compared to the same period last year, when the government collected Rs 549.41 billion. This marks the largest year-on-year growth in fuel tax revenue for any first half of a fiscal year in Pakistan’s history.
The federal government raised the petroleum levy on petrol by Rs 4.65 per litre last month, taking it to Rs 84.27 per litre, while the levy on high-speed diesel was increased by Rs 0.80 per litre to Rs 76.21 per litre. Combined with other taxes and charges, Pakistanis are now paying more than Rs 100 per litre in taxes on both petrol and diesel.
In addition to petroleum levy collections, the government also collected Rs 25.48 billion under the carbon levy during the first half of the fiscal year. Officials say the additional revenue is part of broader fiscal measures aimed at strengthening government finances amid economic challenges.
Fuel taxes have become a major revenue source for the government in recent years, especially under IMF-linked fiscal targets. However, rising petroleum levies have also increased transport and production costs, adding pressure on inflation and household budgets.
