Source: newsthemegh.com
According to a letter dated April 3, 2024, sent to different participants in the oil marketing and distribution sector, the National Petroleum Authority (NPA) has chosen to reinstate the Price Stabilization and Recovery Levy on petroleum products.
The instruction states that a charge of 16 pesewas per liter for petrol, 14 pesewas per liter for diesel, and 14 pesewas per kilogram for liquefied petroleum gas (LPG) to be implemented as of April 4, 2024.
It is not made clear why this reversal occurred. Prior to this, the NPA had declared that the Price Stabilization and Recovery Levy would be suspended on March 28, 2024, as per a direction from the Finance Ministry and the Energy Ministry.
The period of this suspension was supposed to run from April 1, 2024, until June 30, 2024.
Prices for petroleum products may rise as a result of the decision to reintroduce the levy on April 4, 2024. This is a result of the Price Stabilization and Recovery Levy not being factored into Oil Marketing Companies’ price build-up calculations in their April 1 adjustments.
The National Petroleum Authority is authorized by the Energy Sector Levies Act 2015 (Act 899) to set a price floor for petroleum products for end users for a predetermined amount of time.
For petrol, the current levies are 16 pesewas per liter, for diesel, 14 pesewas per liter, and for LPG, 14 pesewas per kilogram.
In the past, the government has employed the suspension of this charge as a strategy to protect consumers from the effects of growing prices on global markets.
To lessen the impact on consumers, the government stops applying the fee when prices reach a particular threshold.
Nevertheless, the taxes are reimposed after a specific amount of price decline.