Pakistan, July 2 -- The federal government has increased the carbon tax on petrol and diesel by Rs5 per litre, with the revised rate taking effect from midnight, according to an official notification.

Under the new rates, the carbon tax on petrol and high-speed diesel has been increased from Rs2.5 to Rs5 per litre. The government has simultaneously reduced the petroleum levy to offset the immediate impact of the higher carbon tax on fuel prices.

The notification also confirmed that a carbon tax of Rs5 per litre has been imposed on high-octane fuel and furnace oil. Officials said the full impact of the revised carbon tax is expected to become clear when the government announces its next review of petroleum product prices.

Last week, the...