The federal government has announced that the Climate Support Levy now doubles to Rs5 per litre on petrol and high-speed diesel. The revised rates took effect on July 1 as part of Pakistan’s commitments under the International Monetary Fund (IMF) programme.
According to a notification issued by the Petroleum Division, the Climate Support Levy doubles from Rs2.50 to Rs5 per litre for petrol. The same Rs5 per litre levy has also been introduced for high-speed diesel under the revised taxation framework.
While the Climate Support Levy doubles, the government has reduced the Petroleum Levy on both petrol and high-speed diesel by Rs2.50 per litre.
Following the revision, the Petroleum Levy on petrol has been lowered from Rs66.64 to Rs64.14 per litre. The levy on high-speed diesel has also been reduced from Rs79.54 to Rs77.04 per litre.
Despite these tax adjustments, consumers will not notice any immediate change in fuel prices. Petrol and diesel prices will remain unchanged until the next scheduled fortnightly fuel price review.
Officials said the latest changes are part of Pakistan’s broader fiscal commitments under the IMF programme. The government aims to strengthen revenue collection while continuing economic reforms agreed with the international lender.
The Climate Support Levy is expected to become an important source of government revenue. According to official estimates, the levy is projected to generate around Rs48 billion during the 2025-26 fiscal year.
Government figures also show that the levy has already contributed significantly to public finances. Between July 2025 and March 2026, authorities collected Rs37.27 billion through the Climate Support Levy.
The revised tax structure is also linked to the government’s overall budget strategy. Officials have set ambitious revenue targets for the upcoming fiscal year.
Budget estimates for FY2026-27 project non-tax revenue of Rs5.336 trillion. This is higher than the estimated Rs5.093 trillion for the current fiscal year.
A significant portion of this revenue is expected to come from petroleum-related charges. Nearly Rs1.727 trillion is projected to be collected through the Petroleum Levy and the Climate Support Levy.
Officials say these measures are intended to strengthen public finances without changing fuel prices immediately. They explained that the revised levy structure helps meet fiscal targets while maintaining price stability in the short term.
The decision comes as Pakistan continues implementing economic reforms under its IMF-supported programme. These reforms focus on improving revenue generation and reducing pressure on the national budget.
As the Climate Support Levy doubles, authorities will continue monitoring its impact on government revenue and the wider economy. Any future changes to fuel prices will be announced during the regular fortnightly review conducted by the government.
The latest revisions highlight the government’s continued reliance on petroleum-related taxes to support fiscal reforms while fulfilling commitments made under the IMF programme.
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