Outstanding levy: Row over gas cess payment remains unresolved

Ministry asks CNG stations to deposit Rs28b but industry disagrees


Our Correspondent September 23, 2016
Ministry asks CNG stations to deposit Rs28b but industry disagrees. PHOTO: EXPRESS

ISLAMABAD: The government and the compressed natural gas (CNG) sector are locked in a row over payment of gas infrastructure development cess (GIDC) as the latter is reluctant to pay the outstanding levy.

Following a meeting of the Senate special committee constituted to oversee implementation of the GIDC Act 2015 on Friday, the director general gas of the Ministry of Petroleum and Natural Resources told journalists that the amount outstanding against the CNG sector was Rs42 billion.

He revealed that in a series of meetings held with the All Pakistan CNG Association the ministry offered them to pay Rs28 billion, but they still termed the demand unjustified and said they could pay only Rs16 billion.

The Senate special committee directed all the stakeholders to come up with a viable plan so that the matter could be settled as early as possible.

The meeting, chaired by Ilyas Ahmed Bilour, expressed disappointment over the absence of petroleum minister and petroleum secretary and said neither the Ministry of Finance considered recommendations of the committee nor the Ministry of Petroleum suggested a viable solution.

The committee noted that all sectors were ready to pay the outstanding GIDC but not retrospectively.

Finance Secretary Waqar Masood said his ministry was ready to accept justified demands of the CNG association, adding the entire outstanding amount could not be waived, but adjustment was possible.

Masood assured the committee that the Ministry of Finance along with the CNG body and the Ministry of Petroleum would look into the entire matter and make recommendations to the committee after reaching a consensus.

According to the CNG association senior leader, Ghiyas Abdullah Paracha, they had hired a chartered accountant on the directive of the committee to assess the exact outstanding GIDC, but the Ministry of Finance did not agree with the outcome.

Ministry of Petroleum Additional Secretary Furqan Bahadur Khan said the GIDC Act 2015, as passed by parliament, provided that the cess received by CNG station owners from the gas consumers under the GIDC Act 2011 and GIDC Ordinance 2014 was valid under provisions of the 2015 Act.

“Therefore, the question of not paying the cess retrospectively does not arise, however, the ministry is ready to discuss the issue with the CNG association and ready to accept its justified demands,” Khan added.

Published in The Express Tribune, September 24th, 2016.

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