In its effort to collect funds for infrastructural development, the government promulgated the Gas Infrastructure Development Cess (GIDC) Ordinance, 2014 last month despite the fact that the Supreme Court had earlier stopped the collections of funds under a similar law in 2011. The current ordinance has been issued to give a legal cover to the collection of funds from industrial gas consumers and it has already collected Rs 84 billion under this head. The funds will be used in Iran-Pakistan Gas Pipeline and Turkmenistan, Afghanistan, Pakistan and India (TAPI) gas pipeline projects. However, Ijaz A Mumtaz, the president of the Lahore Chamber of Commerce and Industry (LCCI), has expressed concern over reinforcement of the cess and has demanded the government withdraw it. The LCCI chief says that the cess is in contravention to articles 8 and 18 of the constitution and it is making negative impact on the economic activities in the country as the project of Pak-Iran Gas Pipeline has been shelved and there is no reason to collect revenue from the industrialists under this head. He says that after the Supreme Court, the Peshawar High Court and the Sindh High Court had also ruled against the collection of the cess, and urged the government to facilitate business community instead of squeezing more and more money from them.
It seems every government is bent upon pressuring the business community without realising that economic activities always increase revenue for the national exchequer. A vibrant economy creates new employment opportunities and generates more revenue but irrational increase in taxes and duties only increase the cost of production. The Pakistani exporters are already struggling to keep their presence in the international market and they will not be able to keep up with their competitors if cost of production is increased. The country’s industrial sector is earning billions of rupees foreign exchange by producing value added export products and they need facilities not troubles.
