Dealers Threaten Nationwide Petrol Pump Shutdown Over Advance Tax

The Pakistan Petroleum Dealers Association (PPDA) has issued a stern warning to the government, threatening to shut down petrol stations nationwide on Friday, July 5, if the newly imposed advance tax is not withdrawn from the Finance Bill 2024-25.

PPDA’s Stance on Advance Tax

PPDA Chairman Abdul Sami Khan criticized the 0.5% advance tax on petroleum dealers, arguing it places an unsustainable burden on their businesses. He emphasized the severe impact this tax would have, exacerbating already declining sales and threatening the viability of petrol pump operations across the country.

Quote from Abdul Sami Khan:

“The advance tax is making it impossible for us to sustain our businesses. The government must reconsider and abolish it immediately, or we will be forced to shut down operations nationwide.”

Financial Strain and Smuggling Allegations

The chairman highlighted the financial strain that dealers are under, citing declining sales and accusing the government of indirectly supporting smuggling by imposing burdensome taxes while turning a blind eye to illegal fuel trade.

Upcoming Delegation Meetings

To address their concerns, a delegation of petroleum dealers is set to visit Islamabad today. They aim to meet with:

• Finance Minister
• Petroleum Minister
• Chairman of the Federal Board of Revenue (FBR)

The PPDA hopes these meetings will lead to a resolution and the withdrawal of the advance tax, avoiding the need for a nationwide shutdown.

Broader Context and Impact

This move by the PPDA comes amid widespread frustration in the petroleum sector over increasing operational costs and declining profitability. The Finance Bill 2024-25 introduced several new taxes and levies, with the 0.5% advance tax on petroleum dealers among the most contentious.

Implications of a Shutdown

A nationwide shutdown of petrol pumps would significantly disrupt daily life, affecting transportation and commerce. The threat underscores the urgency of the situation and the potential for widespread impact if the tax issues are not resolved.

Quote from a PPDA Member:

“If the government does not heed our demands, we have no choice but to shut down. This tax will push many of us out of business, and we cannot afford it.”

Government Response

As of now, there has been no official response from the government regarding the PPDA’s demands or the upcoming meetings. The outcome of the delegation’s visit to Islamabad will be crucial in determining the next steps.

The PPDA’s threat to shut down petrol stations nationwide over the advance tax reflects growing tensions in Pakistan’s petroleum sector. The delegation’s meetings with key government officials will be critical in deciding whether a resolution can be reached to avoid a potentially disruptive shutdown.

Key Points:

• Advance tax: 0.5% on petroleum dealers.
• Threatened shutdown: Nationwide on July 5 if the tax is not withdrawn.
• Delegation meetings: Scheduled with Finance Minister, Petroleum Minister, and FBR Chairman.
• Impact: Potential significant disruption to daily life and commerce.