PESHAWAR, Aug 25: The NWFP government on Saturday suspended the city district government’s decision of levying one per cent tax on CNG filling stations, according to official sources.

A notification issued by the NWFP local government and rural development department and sent to the district nazim and the DCO said that the tax on CNG filling stations was imposed without prior approval of the provincial government, hence it was being held in abeyance with immediate effect.

The city district government had imposed one per cent tax on 68 gas stations operating in the city which led to a two-day strike by the owners.

The strike was called off on Wednesday following the NWFP chief minister’s intervention.

A committee, comprising three members each from the All-Pakistan CNG Association and the district government, is reviewing the issue and it will submit its recommendations within 15 days.

Official sources said that under the second schedule of the Local Government Ordinance 2001, the city district government was authorised to impose taxes under the prescribed procedure.

Under the rules, the district government has to send a tax proposal to the provincial government for approval after holding public hearings and getting it vetted from its budget and taxation committee.

In case the government turns down the proposal, the district government cannot collect such levy, the sources said.

The provincial government’s decision of suspending the tax has made the district government’s initiative ineffective and it has to re-initiate the process, if it wants to impose it again, the sources said.