Govt decides to cut oil price hike by half

[ares]

Govt decides to cut oil price hike by half


Govt decides to cut oil price hike by half | Buisness | DAWN.COM

ISLAMABAD: The government will halve a 9.9 per cent fuel price increase proposed this week, the finance minister said on Thursday, in an apparent concession to a party key to maintaining the governing coalition.

The price hike will instead be almost five per cent, a figure likely to disappoint the International Monetary Fund which has been pressing Pakistan to raise taxes and end subsidies as part of a package of fiscal reforms.

Implementing these reforms is a condition for the IMF to disburse an $11 billion IMF bailout program to Pakistan.

“This has been decided and we will formally notify it after getting approval from the prime minister,” Finance Minister Hafeez Shaikh told reporters after meeting representatives of the Muttahida Qaumi Movement (MQM), one of the biggest parties in the coalition government.

“It means we (the government) have to bear more burden.”

The MQM, which in January forced the government to reverse a similar rise in fuel prices, had expressed serious concerns over the latest increase announced on Tuesday.

The party’s ire rekindled concerns over the stability of the weak government — led by President Asif Ali Zardari’s Pakistan People’s Party — after it made unspecified threats if the government failed to reverse the latest price hike within three days.

 

[SMC]

Pakistan's public (well a good number of them) are such self-entitled freaks. They don't want to pay taxes and expect everything in return. Oil prices are going up in the whole world yet they want to keep it low.

 

[ares]

Pakistan's public (well a good number of them) are such self-entitled freaks. They don't want to pay taxes and expect everything in return. Oil prices are going up in the whole world yet they want to keep it low.

It is petty politics for short term gains by your govts coalition partners and opposition, they are jeopardising your country's economic future for earning some brownie points with the common man by taking popular decisions.

But come september has your country not implemented some serious economic reforms..IMF will withdraws its budgetary support and $3Billion it is suppose to pay to Pakistan this yr..Then Pakistan will really left with very few options on how to fund your 7% budget defecit.

 

[AZADPAKISTAN2009]

Well Sales Tax is must for Pakistani Economy and Gov to survive and introduction of cars that run huge mileage - bringing in 10 year old Japanese cars is not a solution they take too much gas

 

[The HBS Guy]

How do they propose to keep the oil prices low? Will they subsidize oil? Where will the money for subsidy come from?

Do they have a plan or this is just another populist decision?

 

[ANG]

Hi, the current Pakistani leadership cannot make any sound fiscal decision. Look at the state of the economy, lack of power, water, and investment. They keep deferring the inevitable tough decisions. Pakistan has to many subsidies, loss making state enterprises, and lack of taxes. Pakistan has one of the lowest tax to GDP ratios in the world.

List of countries by tax revenue as percentage of GDP - Wikipedia, the free encyclopedia

They want to keep spending, but not pay their share. Well time is up, and hence a debt default is around the corner. Please also watch the video in the NYtimes article, it pretty much sums it up.

http://www.nytimes.com/2010/07/19/world/asia/19taxes.html

 

[Lord Of Gondor]

Oh!!!!I thought fuel price in India will go down!!!!Anyways,congrats to Pak!!!!