PESHAWAR, April 21: The NWFP government has received Rs219m under the head of general sales tax (GST) on services from the federal government during the first nine months of this fiscal year, according to official sources.

Out of the total funds transferred to the province by federal government by the end of March 2003, a sum of Rs219m was transferred against its annual share of GST on services — a provincial levy collected by the Central Board of Revenue (CBR) from the services sector of province(s).

Islamabad had projected to transfer Rs413.203m to NWFP under this head during 2002-03.

However, the funds transferred to the province during July-March 2002-03 left the provincial government trailing behind by over Rs90m in comparison with the amount the provincial finance managers were expecting to receive during the same period — on proportionate basis.

Though transfers to provinces under different heads are not made on proportionate basis in line with Islamabad’s agreements with international lending agencies, still provincial authorities calculate budgetary shortfall [in receipts] by dividing the total annual share — under various heads of receipts — into 12 equal monthly instalments for their own convenience.

In this way, said the sources, shortfall under the head of GST on services stood at Rs91m at the end of the third quarter of 2002-03. On proportionate basis, the province should have received Rs309m during the July-March period, the sources added.

Official sources, however, expressed the hope that the province would receive the total amount of funds it had been projected for the current financial year. They pinned hopes on the precedents of CBR’s revenue generation recording improvement during the last quarter of every financial year for the last several years.

“In view of the last financial year, we are hopeful that the province would receive even more than the funds it has been projected for the current financial year,” said a senior government functionary.

The NWFP had been projected to get Rs266.7m on account of GST on services in the 2001-02 financial year against which it received over Rs375m after CBR recorded substantial improvement in revenue generation under this head.