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SC reserves judgment in GST hike case

ISLAMABAD: The Supreme Court on Thursday reserved its verdict in suo moto case pertaining to imposition of General Sales Tax (GST) on petroleum products without parliament's prior approval.

A three-member bench of the apex court, headed by Chief Justice Iftikhar Muhammad Chaudhry, resumed hearing of the suo moto notice on increase in Petroleum prices.

During the course of proceedings, the chief justice remarked that 1 per cent increase in GST led to 15 per cent surge in basic commodities prices.

He said that court is not stopping the government from imposing the tax but it should work within its constitutional limits.

The chief justice remarked that the way Federal Board of Revenue (FBR) imposed 1 per cent increase in the GST is unacceptable.

Stating parliament’s authority to impose taxes, he remarked that if the imposition of interim tax once allowed then the parliament's role will diminish.

Counsel for Oil and Gas Regulatory Authority (OGRA) Salman Akram Raja informed the court that the government member cannot oppose budget recommendations under article 63 (A) of the Constitution.

He said that authorities were sure that GST hike will be approved, thus, prices were increased immediately.

FBR officials informed the court that Rs15 billion would be collected with the imposition of GST in 15 days.

The chief justice remarked that government can impose 16 per cent GST on petroleum prices.

He said that CNG station owners recovered maintenance of the machinery, electricity bills and salaries of the employees from the masses.

The CJP observed that the tax collected from the masses sans parliament’s approval was illegal which should be returned back to the people. “It's a legal requirement which must be fulfilled,” he said.

Salman Akram Raja informed the court that FBR imposed 7 per cent additional tax on CNG stations.

The bench reserved its verdict likely to be announced on Friday.

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