The strike call by petroleum dealers has sparked widespread panic buying of fuel across the country.
Financially stressed commuters rushed to petrol pumps, forming long queues on Thursday to refill their vehicle tanks ahead of a daylong shutdown planned by fuel stations for Friday.
The strike, initiated by owners of approximately 13,000 fuel stations nationwide starting at 6 am, may extend beyond one day, according to Abdul Sami Khan, chairman of the Pakistan Petroleum Dealers Association (PPDA). He mentioned that dealers would assess the government’s response and strategize further by early afternoon to push for the withdrawal of the newly imposed 0.5% advance turnover tax on fuel sales, effective from July 1, 2024.
The tax-heavy budget is significantly burdening people from all sides, complicating their lives further. The strike has caused chaos, with individuals scrambling to secure fuel for their daily commutes and activities. Those most affected include motorcycle riders delivering goods, logistics companies with large trucks, mobile vendors, and ambulance operators.
Earlier in the week, the PPDA held discussions with government officials, including Finance Minister Muhammad Aurangzeb and representatives from the Federal Board of Revenue (FBR) and the Oil and Gas Regulatory Authority (Ogra), regarding the tax’s withdrawal. However, talks ended inconclusively, and communication between both parties has since remained disconnected.
Sami Khan clarified that the PPDA had given prior notice of the strike to minimize disruption, stressing that some petrol pumps had already run out of fuel during the day. He expressed frustration with the government’s apparent disregard for the situation’s severity, highlighting the substantial financial impact on dealers.
Khan estimated that dealers selling 8,000 to 10,000 liters of fuel daily could face an additional monthly cost of Rs700,000-800,000 due to the new tax, amounting to around Rs10 million annually per dealer. He argued that such taxes render the fuel business unsustainable, given dealers’ already narrow profit margins of approximately Rs3 per liter.
The recent hike in diesel prices by Rs9.56 per liter to Rs277.45 and petrol prices by Rs7.45 per liter, effective July 1, has exacerbated