Govt Plans New Fuel Price for Cash vs Digital Payments
Get ready, Pakistan for New Fuel Price! The upcoming federal budget for the fiscal year 2025-26 is brewing some major price changes that could impact your daily budget, especially regarding fuel price and purchasing new cars. The fedral government is planning to make a big push towards a “cashless economy,” which means your digital transactions might soon become more friendly.
New Fuel Price: Cash vs. Card
Imagine you reach to a petrol station, and you have a payment choice. Pay with cash, and it might cost you a little more. Pay digitally (think debit/credit cards, or mobile apps), and you’ll get a better deal. That’s right, the fedral government is planning to introduce a differential tax system for cash and digital transactions, especially in the fuel sector.
Currently, the plan is to charge the standard 18% sales tax on fuel price if you pay digitally. But if you choose to pay by cash, you might see an additional charge of Rs. 2-3 per liter to your bill. This isn’t just about encouraging digital payments; it’s also a smart move to streamline tax collection and bring more of the informal economy into the official fold. The Federal Board of Revenue (FBR) has been working hard to track retail businesses, and this change could really help them get a clearer picture.
In order to implement, all petrol stations across the country will soon be legally required to offer digital payment options. So, get ready to see more QR codes and card machines at your local pump!
Small Cars, Big Price Hikes?
It’s not just changes in petrol prices; car buyers might also need to brace themselves. If you are planning to buy new car, especially a smaller one of more budget-friendly, there’s news that might dim your excitement a bit.
Previously, there were talks about increasing the withholding tax (WHT) on cars with engines larger than 1,300cc. Now, the latest reports suggest that even smaller cars, those with engine capacities up to 850cc, might face a higher sales tax. Currently, these smaller cars enjoy a reduced sales tax rate of 12.5%. However, under the new proposal, this could jump to the standard sales tax rate of 18%.
These proposed changes are all part of the government’s efforts to modernize the economy, increase tax collection, and reduce the reliance on cash. Keep an eye out for the official budget announcement for the final details. It’s an exciting time of change for Pakistan’s economy!
Also read: Petrol Price in Pakistan Increased Now: June 1, 2025