Refineries seek adjusting relief in POL prices to offset sales tax burden

ISLAMABAD: The local refineries have suffered a loss of Rs13 billion in the first nine months of the current fiscal which is expected to increase up to Rs18 billion by June 30 mainly because of the sales tax exemption on POL products, shrinking margins and inventory losses.

This was mentioned in a letter on April 8, 2025 to OGRA chairman, signed by MDs of Pak-Arab Refinery Company (PARCO), National Refinery Limited (NRL), Pakistan Refinery Limited (PRL), Attock Refinery Limited (ARL) and Cnergyico PK Limited (CPL). They said they are on the verge of collapse after suffering Rs13 bn in losses in the last nine months due to shrinking margins and inventory losses and the imposition of sales tax exemption on POL products diesel, LDO and kerosene oil. They feared these losses would mount to Rs18 billion by June 30.

They have requested the government to shift the relief in POL prices by Rs4.60 per litre on petrol and diesel to the refineries to adjust their sales tax claims of approximately Rs18 billion providing much-needed solace.