PRL, NRL, ARL to enjoy tax holiday for upgradation projects

Aftab Ahmed

Islamabad: Oil refineries- RRL, NRL, and ARL got a green light on Tuesday to avail ten-year tax holiday for up-gradation projects to achieve Euro-V specifications.

Finance Minister Shaukat Tarin has okayed to remove the condition of 100,000 barrels deep conversion refinery to qualify for the incentives.

Earlier, only Byco had qualified to avail incentives for up-gradation projects to achieve Euro-V specifications.

The finance division held a meeting to review progress on Draft Pakistan Oil Refining Policy 2021. Federal Minister for Finance and Revenue Mr. Shaukt Tarin chaired the meeting.

In a meeting held here, finance minister Shaukat Tareen approved ten years tax holiday for refineries, up-gradation projects while removing the condition of deep conversion with 100,000 barrels capacity to enjoy tax relief.

Ten years income tax holiday on upgrades of existing refineries to achieve Euro V specs. Condition of deep conversion and 100,000 BPD to be removed. He also agreed to twenty years income tax holiday for new deep conversion refineries.

10 % Custom Duty

Tarin also assured approval of custom duties on MS and HSD to be at 10% as already proposed in Finance Bill 21-22. Customs duty on crude oil will remain at 2.5 % for one year only in 21-22 and will be zero in the next budget.

Minister for Energy, SAPM Finance, SAPM Petroleum & Power, Secretary Petroleum, Secretary Finance, and DG Oil. Refineries were represented by MD/ Parco and ARL attended a meeting.

The Federal Minister for Finance and Revenue Mr. Shaukat Tarin during the meeting said that the Prime Minister is very keen on progress in all sectors of the economy for sustainable growth. The energy sector is indeed very crucial to keep the cycle of the economy moving with ever-growing momentum.

Furthermore, oil refineries in Pakistan have been a pillar of the energy security of the country and now the government wants the domestic oil refineries to upgrade themselves at par with international standards. Modernization, efficiency, and environmental friendliness should be common characteristics of all oil refineries in Pakistan. The government of Pakistan is willing to extend all support permitted under the law and policy framework to this effect.

The representatives of oil refineries said that the oil refinery industry is very happy due to the support and patronage provided by the government.

They added that the entire oil refinery sector is ready to upgrade itself to international standards and a complete framework is ready in this regard. With the approval of the new Oil Refining Policy, the journey towards international standards will start.

Meanwhile, the Federal Minister for Finance and Revenue directed the participants to work jointly to overcome all the hurdles in the formulation of the new Oil Refining Policy 2021 so that same may come into effect at the earliest.