Pakistan Business Forum urges cut in petroleum levy by Rs60 per litre
The Pakistan Business Forum (PBF) has called on Prime Minister Shehbaz Sharif to slash the petroleum levy by Rs60 per litre, arguing that current fuel taxes are unaffordable and stifling economic activity.
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Desk Analysis
How This Affects the Exchange
Sector Effect
Positive · Buy bias
Lower fuel taxes boost Transport, Cement and Steel sectors – Buy bias on related tickers.
Sectors & Direction
Desk read
Desk call: Buy bias · Positively affected
- TransportPositively affected
- CementPositively affected
- SteelPositively affected
Companies
Mentions in This Briefing
Sectors: Transport, Cement, Steel — Positive · Buy bias. PSX tickers: HUBC, CEM, TRG. Lower fuel taxes boost Transport, Cement and Steel sectors – Buy bias on related tickers.
Full Story
Open on Business Recorder## PBF’s demand for immediate levy reduction
The Pakistan Business Forum (PBF) has formally requested Prime Minister Shehbaz Sharif to reduce the petroleum levy by Rs60 per litre. The forum argues that the current tax burden on petrol, which stands at Rs106.15 per litre, is unsustainable for both consumers and businesses.
## Inflation, sluggish activity and rising fuel costs
PBF chief organiser Ahmad Jawad highlighted that inflation continues to climb while overall economic activity remains weak. Over the past eight months, diesel prices have risen by Rs135 per litre and petrol by Rs114 per litre. The forum contends that high electricity tariffs and frequent load‑shedding further strain households and firms.
## Revenue versus growth mismatch
According to PBF, the government collected Rs1,567 billion from the petroleum levy in the last fiscal year – a 29 % increase over FY 2024‑25. Jawad warned that rising tax receipts have not translated into proportional economic growth, calling for a comprehensive policy review.
## Suggested fiscal adjustments
The forum proposes that the government could offset the levy cut by curbing non‑essential spending and adopting austerity measures. It believes lower fuel prices would ease consumer pressure, cut business operating costs, boost competitiveness and stimulate activity in sectors such as transport, cement and steel.
## Parallel concerns on wheat policy
PBF also voiced strong reservations about the abolition of the wheat support price, warning that it could force higher wheat imports and increase fiscal pressure. The forum urged the government to announce a wheat support price before November to give farmers certainty and protect the exchequer.
## Potential market implications
A reduction in the petroleum levy would likely lower input costs for transport and manufacturing firms, improve profit margins for companies reliant on fuel, and enhance overall market sentiment. Conversely, the government would forgo a significant revenue stream, which could affect fiscal balances.
## Outlook
If the levy is cut, sectors directly benefiting from lower fuel costs may see improved earnings and investor confidence, while the broader economy could experience a modest stimulus.
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*All statements are paraphrased from the original Business Recorder report dated 11 September 2026.*