Several hundred petrol pumps across Pakistan observed a strike on Friday amidst divisions between petroleum dealers over a protest against a 0.5% advance tax imposed on them in the budget for fiscal year 2024-25.
Announced earlier this week, the strike decision was confirmed by Pakistan Petroleum Dealers Association (PPDA) Chairman Abdul Sami Khan after talks between the group and the government failed to make any headway on withdrawing the new tax. However, the PPDA appeared divided over the move, with a group within the organization opting not to go on strike until the government was given a chance to reverse its decision.
Speaking with media, PPDA Secretary General Noman Ali Butt rubbished talk of a nationwide strike, maintaining the supply of petroleum products would remain normal in most parts of the country. “The dealers’ association did not announce a strike, just few elements gave the strike call,” he said. “Talks with the government are underway and the authorities have assured to address our grievances,” he added. Similarly, PPDA spokesperson Hasan Shah assured petroleum dealers that a strike remained the nuclear option, but negotiations were the best route to ensuring their demands were met.
The divisions within the PPDA appeared most stark when comparing the situations in Sindh capital Karachi and Punjab capital Lahore. The former saw a significant number of petrol pumps shuttered while the latter saw the reverse, with a majority of pumps remaining open while only a few observed the strike. Reportedly, dealers in Lahore, Islamabad and Rawalpindi have assured the government they would not go on strike on Friday.
Earlier, the Oil and Gas Regulatory Authority (OGRA) and Petroleum Division had announced that petroleum products would remain available across the country without any hindrance. “The concerns of the PPDA have also been taken up with the FBR [Federal Board of Revenue] and Finance Division for consideration,” they said in a joint statement.
The organizations further said all oil marketing companies (OMCs) had been directed to ensure adequate supplies of petroleum products at pumps owned and operated by them. They assured the public that a monitoring cell at DG (Oil) office would monitor the fuel supply position and coordinate with all stakeholders during the strike, adding OGRA would mobilize its monitoring teams to take any required remedial actions.
Reportedly, during negotiations, the government has suggested to dealers it could increase their commissions to compensate for the 0.5% tax. Separately, oil marketing companies have formally demanded an increase of up to 60 percent in their profit margin on petrol and diesel sales to meet costs incurred in maintaining a 20-day stock cover; turnover tax; handling losses; demurrage; unadjusted sales tax and operating expenses.