Bill tabled in National Assembly to penalise petroleum levy defaulters
The government has tabled a bill in the National Assembly that sets penalties for oil companies and refineries that fail to pay the petroleum levy or climate support levy. Penalties include licence cancellation and up to three years in prison.
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- Bill tabled in the National Assembly and referred to the standing committee
- Defaulters face surcharges, licence suspension or cancellation, and up to three years in prison
- The bill does not change levy rates or directly change petrol and diesel prices
The government has tabled the Petroleum Products (Petroleum Levy and Climate Support Levy) (Amendment) Bill, 2026 in the National Assembly, according to ProPakistani. Minister for Parliamentary Affairs Tariq Fazal Chaudhary introduced it, and it was referred to the relevant standing committee.
Under the bill, paying both the petroleum levy and the climate support levy becomes a condition of every licence issued by the Oil and Gas Regulatory Authority (OGRA). Refineries must deposit the levies in advance, before fuel leaves their gates.
Those who pay late face a surcharge of 1.5 times the six-month KIBOR or 12 percent a year, whichever is higher. The surcharge is charged daily until the payment is made. OGRA can also suspend or cancel the licence of a defaulter.
Failure to pay in full can bring up to three years in prison, a fine equal to the unpaid amount, or both. Directors and partners of a defaulting company can be held liable, unless they prove the default happened without their knowledge or consent.
Companies will also have to file monthly levy statements and an annual audited certificate. The company must bear the cost of the audit.
The bill does not change the rate of either levy and does not directly change petrol or diesel prices. The government aims to collect Rs. 1.6 trillion from the petroleum levy in FY27.
The bill comes ahead of an important IMF Executive Board meeting on Pakistan's loan programme. Tighter levy collection is part of Pakistan's commitments under that programme, which recently reached a staff-level agreement pending Executive Board approval.
Why it matters
The penalties apply to fuel companies and refineries and could affect fuel prices and supply for consumers, though the bill itself does not change levy rates or directly change petrol and diesel prices.
