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Thursday, August 18, 2022
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Ban on luxury items lifted by government

The government has reversed the import ban on “non-essential and luxury items,” excluding cars, cell phones, and gadgets, and hiked dealers’ commission on the sale of petroleum products by up to an unprecedented 70%. The ban was imposed in May this year.

On Thursday, the decision was made during a session of the cabinet’s Economic Coordination Committee (ECC) chaired by Finance Minister Miftah Ismail.

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A tender for 200,000 tons of imported wheat valued at $408 per ton was also approved by the committee, and $11.6 million was set aside as goodwill compensation for the Chinese victims of the Dasu hydroelectric project in July of last year.

The council decided to raise the dealers’ commission on high-speed diesel (HSD) sales by 70%, to Rs7 per litre from Rs4.13 at the moment.

In addition, it raised the dealers’ commission on the sale of petrol by 43 percent to Rs7 from the current Rs4.90 per litre.

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This is the country’s largest one-time rise in margins permitted. The gathering was informed that starting in December 2021, dealers’ profit margins on the sales of HSD and petrol will also climb by more than 25%.

Since then, the commission on petrol and HSD has increased by a combined 79 percent and 112 percent.

It was reported at the meeting that dealers had threatened to go on strike and requested roughly Rs. 14 per litre of commission on both goods, but it was reduced to Rs. 7.

Oil marketing companies (OMCs) requested an increase in their margins to Rs7 per litre from the current Rs3.68 on both products, but the ECC was informed that this would be handled separately. As a result, the benefit was given to dealers with effect from August 1 and OMCs on September 1 to increase prices gradually.

The ECC also relaxed the restriction on imported items with the exception of completely built units (CBUs) of autos, mobile phones, and home appliances.

The conference was informed that between May 20 and July 19, the imports of prohibited goods decreased by about 70%, from $399.4 million to $123.9 million.

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