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Wednesday April 17, 2024

Govt set to surpass Rs869bn PDL collection target

By Our Correspondent
April 04, 2024
A representational image of a man holding a fuel nozzle at a petrol station. — AFP/File
A representational image of a man holding a fuel nozzle at a petrol station. — AFP/File

KARACHI: The government is on track to exceed its Petroleum Development Levy (PDL) collection goal of Rs869 billion for the fiscal year 2024, brokerage JS Global said in a report on Wednesday.

“As we enter the last quarter of the fiscal year, one of the government’s non-tax revenue targets, i.e., PDL, appears to be progressing well,” JS Global said. “We estimate that Rs729 billion of Petroleum Development Levy (PDL) has been collected during 9M FY24, approximating 84 percent of the FY24 collection target of Rs869 billion.”

The brokerage said this is largely on the back of higher PDL allocation towards fuel prices, averaging at Rs59/Rs56 per litre for MS/HSD during the first nine months of the current fiscal year, despite industry offtakes registering an 11 percent year-on-year decline during the period.

“We project the total collection for the full year to clock in at over Rs900 billion, at the current level of PDL. Despite inflationary pressures, this target appears achievable, in our view.”

In March, Pakistan saw a 4 percent year-on-year increase in total petroleum product sales, reaching 1.15 million tonnes. However, furnace oil (FO) sales plummeted by 48 percent year-on-year, totaling only 0.04 million tonnes. Conversely, sales of MS (petrol) rose by 3 percent year-on-year to 0.57 million tonnes, and High-Speed Diesel (HSD) sales surged by 17 percent to 0.46 million tonnes.

“After a period of 21 months, the first year-on-year increase is observed in POL product sales,” JS Global said.“However, sales continue to remain dull despite a modest economic recovery witnessed in recent months after the lifting of import restrictions.”

On a company level, Pakistan State Oil (PSO) reported an 11 percent increase in offtake for March 2024, driven primarily by a 13 percent rise in MS sales and a 15 percent increase in HSD sales. In contrast, FO sales witnessed a significant 66 percent decline year-on-year.