The federal government has increased the carbon levy on petrol and diesel to Rs5 per litre, a move aimed at generating additional revenue while encouraging cleaner energy use.
The revised levy will be applied to both petrol and high-speed diesel and will become part of the overall fuel pricing mechanism. Officials say the measure supports Pakistan’s environmental goals and helps meet fiscal commitments under ongoing economic reforms.
Although the carbon tax is intended to reduce emissions over the long term, it is also expected to slightly increase fuel costs for motorists. Transport operators and businesses that rely heavily on fuel may also feel the impact.
Economic analysts say the higher levy could contribute to government revenue but may add to transportation and logistics expenses if fuel prices remain elevated.
The government maintains that the policy is part of broader efforts to improve public finances while gradually promoting cleaner and more sustainable energy practices.
