KARACHI: The CNG Association has rejected the recovery of Rs4 billion from CNG stations in the province and threatened if the issue was not resolved, all CNG stations in Sindh would shut down after 10 days.
The All Pakistan CNG Association (APCNGA) rejected the Sui Southern Gas Company (SSGC) demand on the Federal Board of Revenue’s (FBR) pressure. The amount was levied on CNG stations as additional sales tax for the period April 2014 to-date.
APCNGA Sindh Chairman Shabbir Sulemanji, in a press conference, said that the government is overburdening the tax compliant sectors and this additional, as well as unjustified demand would result in closure of the industry.
Sulemanji said prior to 2008, the CNG industry was under the normal tax regime, whereas 17 percent general sales tax (GST) was charged in the bills on gas charges as was a common practice in all trades and businesses, including industries and manufacturing processes.
After 2008, the FBR imposed 26 percent GST on CNG, which was struck down by the Supreme Court of Pakistan in December 2013, declaring 26 percent GST on CNG stations as unconstitutional and the normal tax regime was restored.
The APCNGA chairman said that the new ordinance would compel the CNG stations to charge sales tax on the total sales, as well as on other purchases, resulting in double taxation and a clear violation of the Section 7 (1) of the Sales Tax Act 1990.
