PESHAWAR, June 25: The NWFP government is likely to get over Rs2.7 billion during the financial year 2002-03 in line with the federal government’s decision to transfer 2.5 per cent of the 15-per cent GST as a support to the local bodies, official sources said.

The federal government has recently decided to allocate 2.5 per cent to the provinces out of the total revenue it would raise through GST during the next financial year, extending additional support to them for their respective local body institutions.

In line with the formula drawn up for distributing an expected amount of Rs32 billion as support to the local bodies, NWFP is likely to get over Rs2.7 billion during the up-coming financial year, senior government functionaries said.

The NWFP government would get Rs866 million in lieu of octroi and zila tax during the financial year 2002-03 in continuation of the last two financial years. However, the province also expected an additional amount of Rs1.9 billion as its share during the next financial year.

“Though Sindh and Punjab would benefit the most in accordance with the Centre’s decision, the same will also benefit the NWFP,” official sources said.

“For NWFP it would create some fiscal space — if implemented in letter and spirit,” said an official.

As per the government’s devised formula, out of an estimated amount of Rs32 billion expected to be distributed among the provinces, Rs18 billion would be transferred in lieu of octroi and zila tax, whereas remaining amount of Rs14 billion would be allocated on population basis.

Sources said that NWFP share of Rs866 million (octroi and zila tax) was much less than the amount the province deserved following the abolition of cess. They said the amount was on the lower side because the abolition of octroi made the province to lose considerably larger amount than it had been getting as support after abolishing octroi.