ISLAMABAD - The already high prices of compressed natural gas (CNG) may witness further hike of Rs 2.50/kg in next couple of days as a high-level meeting at Federal Board of Revenue (FBR) is scheduled today (Monday) to take a decision in this regard, The Nation learnt on Sunday.
Well-informed sources disclosed to this scribe that CNG users should get ready to bear a jolt as its price is likely to witness further hike of Rs 2.50/kg following the imposition of 6 per cent general sales tax (GST). Though the inflation-hit masses are already deprived of cheaper electricity, petroleum products (POL) and liquefied petroleum gas (LPG), the welfare-oriented PML-N government, following the imposition of a heavy GST on CNG by the Federal Board of Revenue (FBR), has now jacked up its price, which is being used by 3.7 million vehicle owners of the country.
The sources also said that Rs 2.68/kg hike in the price of CNG next week is already set owing to the recent colossal hike of Rs 6/unit in the power tariff of commercial consumers. And with 6 per cent raise in GST on CNG, the rate of GST has now reached 31 per cent.
As per details, one per cent increase in GST is on non-registration of CNG and 5 per cent raise has been made on the basis of high gas bills over and above Rs 15,000. So a hike of Rs 2.50/kg is expected, the sources added.
The Supreme Court of Pakistan had already raised concerns over the heavy GST of 26 per cent on the CNG and its judgment in this regard is expected soon.
When contacted, the FBR sources disclosed that the board had summoned an important meeting on August 19 to decide either to fleece the over-burdened masses with additional charges or to withdraw the notification of hike in the GST imposed on the fuel.
The document available with this scribe also shows the CNG sector is unduly charged under SRO 510 (i)-2013 as additional/extra sales tax has been levied under the following conditions:
A. Unregistered persons. B. Inactive persons as per FBR records.
Consequently, CNG stations that have not been registered and are inactive as per the FBR record have been billed 1% extra GST over and above 26% and additional extra tax of 5% on those which have their electricity or gas bills over and above Rs 15,000, the document says.
Once robust CNG industry currently pays 26 per cent GST in advance to the national kitty, but with the hike in GST, it seems that this increase would ultimately further raise the price of CNG while CNG-fitted vehicle owners are already bearing unscheduled gas loadshedding.
Economists opine that since the incumbent government is following the vision of the previous PPP government to phase out the sector, it is persistently jacking up the price of the commodity to make it expensive and out of public reach. They are of the view that the government should cancel the hike in GST on CNG by withdrawing the notification issued in this regard. They say CNG stations should be exempted from the provisions of SRO 510 (i)/2013 or they should be given sufficient time for registration.
It is pertinent to note that no CNG station owes any dues to FBR under GST head as they pay full tax under SRO 480(i)-2007, so they should not be unduly taxed further.