SC declares 9 percent additional tax on CNG as illegal

The Supreme Court has directed Oil and Gas Regulatory Authority (OGRA) to fix gas prices in accordance with international market.
The Supreme Court of Pakistan on Tuesday delivered its verdict in a case pertaining to loadshedding and CNG licences.
The court, in its ruling, declared additional sales tax in the CNG ‘illegal’ and ‘unconstitutional’ and said that CNG licences were apparently issued ‘unlawfully’.
The court said in the decision that the government cannot withdraw subsidy on gas and electricity. It directed concerned authorities to use modern technology to prevent transmission losses.
The court directed NEPRA and PEPCO to give preference to hydel system for power generation.
Announcing the verdict of a case regarding load shedding and Compressed Natural Gas (CNG) prices‚ the apex court has directed OGRA to maintain subsidy on fertilizer sector and ensure supply of fertilizer to farmers on subsidized rates.
The court declared collections of additional 9 percent taxes on CNG as unlawful. It is said that OGRA cannot collect additional taxes other than 16 to 17 percent General Sales Tax.
The court has directed OGRA to deposit extra collections with Federal Bureau of Revenue (FBR) within three months' time. The court also said process of issuing CNG licenses was not transparent.
The court said National Electric Power Regulatory Authority (NEPRA) has failed in delivering its constitutional obligations and directed to maintain subsidy on electricity.

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