LAHORE: The Punjab Revenue Authority (PRA) has collected only Rs450 million under the ‘controversial’ Punjab Infrastructure Development cess from May 25, 2016, to date amid litigation.

The collection of cess from importers at all dry ports of the province has been partially halted because of litigation and decline in clearance of imported goods.

Nishat Mills, Pakistan Tobacco Company and other petitioners have challenged in the Lahore High Court the act, and two notifications of the authority to declare any agency as collecting agents of the cess and the authority’s improper constitution.

The cess has already faced severe criticism by importers, customs agents associations and goods transporters who had province-wise protests and strikes in the recent past to resist double taxation.

Petitioners say act is ultra vires to the Constitution because as per Federal Legislative List import, export and movement of goods across custom borders fall within the federal domain.

They also contend that the notifications dated Sept 2, 2015, and May 16, 2016, through which the PRA declared the Federal Board of Revenue (FBR) and the National Bank of Pakistan as collecting agents are illegal and ultra vires to the act which nowhere empowers the PRA to declare any agency as ‘collecting agents’.

The FBR (Customs) has also supported the argument of petitioners, saying the Customs Department is bearing a huge loss due to the impugned notifications and the act.

However, the PRA says the FBR entered into an agreement with the PRA to collect the cess and the May 16 notification was also issued on the advice of Customs Department.

A source in the PRA told Dawn the authority would exhaust all judicial forums of appeal if the high court passed decision against its stance.

He said the authority had collected around Rs200 million cess in the previous fiscal year 2015-16 against the annual target of Rs5 billion and had set a downward target of Rs2 billion for fiscal year 2016-17 after a decline in clearance of imported goods at dry ports. The authority is able to collect around Rs250 million cess with the help of Customs’ Weboc and One Customs facilities.

Published in Dawn, July 31st, 2016