ISLAMABAD: The Ministry of Energy has clarified reports suggesting that the federal government plans to end electricity subsidies for households consuming up to 200 units per month, firmly rejecting such claims.
According to the spokesman of the ministry, the current policy of giving subsidies to low electricity consumers is still in place with no plans to end it in the future. The current subsidy covers households consuming up to 200 units, which reduces their monthly expenditure on electricity to PKR 2,000 from PKR 7,000.
Media reports in previous months indicated that Pakistan will be taking away untargeted subsidies with a new $1.2 billion climate finance agreement with the IMF. These reports are not true, however, as the government assures that they are not true.
On the other hand, electricity distribution companies have started the task of meter checking and verification in an effort to identify consumers misusing subsidies, including additional meters or any connection of solar systems to the national power grid.
Moreover, QR codes that are used for verification purposes by officials during their visit in the field are meant solely for verifying the electricity bills of consumers.
The government has also assured that the subsidies provided to households consuming electricity below 200 units on a monthly basis will continue unimpeded.
How much are consumers paying in taxes per unit of electricity? Report reveals
Similarly, the Federal Board of Revenue (FBR) has made the energy sector itself a tax collection agent, and it has been revealed that consumers are being charged a tax of Rs 10 per unit in electricity bills.
The documents reveal that electricity bills include a total of 6 different types of taxes, including 18 per cent general sales tax, income tax, and advance tax. More than Rs 900 billion is being collected annually through these taxes.
These taxes are the reason for the rising prices of electricity and petroleum products.
These taxes are leading to an increase in the cost of electricity for general consumers and industries. 18 per cent general sales tax, income tax, and advance tax are being collected from consumers on electricity bills.
