ISLAMABAD: The Supreme Court on Friday declared the 1% increase in general sales tax (GST) introduced as part of the budget 2013-14 null and void, Express News reported.
The decision was announced by Chief Justice of Pakistan Iftikhar Muhammad Chaudhry.
The apex court took suo motu notice of the collection of GST at rates proposed in the budget even before parliament passed the Finance Bill 2013 and the president signed it.
During today’s hearing – the three-judge bench headed by the chief justice – ordered the government to deposit all the money recovered through imposition of additional sales tax to the office of the Supreme Court Registrar.
It also asked the government to take back the additional tax it imposed on petroleum products.
Soon after the verdict was announced, the Oil and Gas Regulatory Authority (Ogra) reversed its decision to increase oil prices through a notification.
The bench had reserved its verdict on June 20 after hearing the arguments of the Attorney General of Pakistan (AG) and the lawyers representing Federal Board of Revenue (FBR) and Ogra.
The government had proposed an increase of the GST from 16% to 17% – a move that was criticised by many as burdening the poorest members of society.
Advocate Rana Shamim had earlier assured the bench that all exempted items such as vegetables, meat, milk, eggs, red chilies, fish, drugs, pulses, fruits and poultry were not taxed with the GST.