ISLAMABAD, Sept 17: The Central Board of Revenue (CBR) has turned down the request of the Compressed Natural Gas (CNG) kit traders seeking extension in exemption of customs duty and sales tax on import of CNG cylinder, kits and other machinery, said a senior official.

The government had allowed the exemption from November 1, 1997, which was due to expire by the end of next month.

The International Monetary Fund (IMF) has already disallowed any further extension in the time-bound exemptions.

A senior customs official in the CBR told Dawn that the traders have been intimated that the government would not extend the SRO38 issued on January 21, 1998.

He was of the opinion that withdrawal would not have much impact on the import of the CNG related equipments, cylinders and machinery.

The CNG dealers have sent a request to the CBR for extension in the SRO. They said that it would promote the CNG use in the country.

According to official figures, more than 850 licenses for installation of CNG stations have been issued. Of these, so far 242 stations have been established in different parts of the country.

These included 239 in private sector and three in the public sector, while 3000 stations are under construction in the private sector. As many as 250,000 vehicles have been converted to CNG, and it was planned to convert 300,000 vehicles by 2003.

According to the proposal sent to the CBR, the private sector has so far invested around Rs3 billion in the business without the participation of the public sector to promote CNG.

The dealers said that the extension in the exemption would encourage the private sector to make more investment in this sector.

They said that the use of this indigenous fuel would not only slash the import bill of petroleum products but reduce pollution level as well.