Cash Buyers Likely to Face Petrol Price Hike in Pakistan’s Budget 2025-26

The federal government is preparing to introduce a range of fiscal measures in Budget 2025-26 aimed at discouraging cash transactions, particularly for petrol purchases, to increase transparency and reduce tax evasion.

According to reports, the upcoming Finance Bill for fiscal year 2025–26 will include proposals to impose extra charges on cash-based transactions. A key suggestion is to add an additional charge of up to Rs3 on petrol purchases made in cash.

“This step aims to curb tax evasion and fuel adulteration at petrol pumps,” reports revealed. In line with this, the government also plans to promote digital payments at fuel stations through options such as QR codes, debit/credit cards, and mobile wallets.

Manufacturers and importers may also be allowed to levy an additional 2% tax on all cash sales. Officials have reportedly conducted several meetings with stakeholders in the corporate sector to evaluate the proposal’s feasibility. A similar charge for cash transactions in retail shops is also under review. Currently, restaurants enjoy tax relief on card-based payments.

“Reports said the buyers will be able to pay in cash but will have to bear higher taxes.” Additionally, importers and manufacturers will be required to collect the standard 18% GST from suppliers and customers using digital payment methods.

To facilitate the shift, the government plans to encourage the use of QR codes and simple digital tools to streamline payment processes.

Meanwhile, salaried individuals may not see significant tax relief in this year’s budget, as the government continues efforts to meet the International Monetary Fund’s (IMF) fiscal targets.

“The government has confirmed that the federal budget for fiscal year 2025-26 will be presented on June 10, rejecting the speculation of any postponement due to Eidul Adha holidays.” Federal Finance Secretary Imdad Ullah Bosal recently reiterated the schedule while addressing media following a National Assembly committee meeting.

The Budget 2025-26 is expected to introduce wide-ranging tax reforms aimed at expanding the tax base and modernizing payment infrastructure in Pakistan.