ISLAMABAD\Lahore
Opposing five per cent increase in General Sales Tax (GST) on petroleum products, the business community of the federal capital on Wednesday called f or urgent withdrawal of this anti-business and anti-people decision.
Business community, in a meeting at Islamabad Chamber of Commerce and Industry, strongly opposed the 5 per cent increase in General Sales Tax (GST) on petroleum products, as it would entail harmful impact on the economy and bring more problems to the common man.
Muzammil Hussain Sabri, President Islamabad Chamber of Commerce and Industry, said that in the wake of more than 48 per cent decline in oil prices in the international market, people were expecting from the government to pass on its full benefit to them, but the further hike in GST on POL products would deprive them of any such relief.
According to the press statement issued here, he said the government was collecting more than Rs.8-billion per month from petroleum levy which ranged from Rs.6/per liter to Rs.14/per liter while the imposition of 5 percent more tax in addition to 17 percent GST would significantly dilute the beneficial impact of reduced POL prices and greatly enhance the transportation cost thus badly affect the business activities.
President ICCI said already the 17 per cent GST in Pakistan was amongst the highest in the world as compared to the average of around 12 percent GST in Asia and there was a dire need to bring down this indirect tax to single digit level in order to facilitate the growth of business and economic activities. However, the government has further increased this tax on POL products taking it to 22 percent, which has no precedent in the world. He was afraid that in case of upward trend in oil prices in international market, high taxes on POL products in Pakistan would become unbearable.
He said the current precarious economic situation demanded more facilitation measures for private sector to give boost to business and industrial activities. However, instead of giving more space to private sector for economic revival, government was taking decisions that would further enhance the cost of doing business and slow down economic activities.
Muzammil Sabri also rejected the proposed 30 percent increase in gas tariffs from next calendar year that would almost cripple manufacturing activities and hurt exports. He said instead of increasing taxes on POL products, government has many other better options to improve its revenue collection. He stressed that government should immediately eliminate all tax exemptions/concessions, bring all taxable incomes into the tax net and focus on developing a fair and equitable taxation system that must facilitate economic growth instead of stifling business activities.  
Meanwhile, the Lahore Chamber of commerce and industry Wednesday welcomed another cut in petroleum prices and said that it would help bring down cost of doing business in Pakistan, however, the All Pakistan Anjuman-e-Tajiran has criticized the government move of increasing General Sales Tax (GST) on petroleum products from 17 per cent to 22 per cent cutting relief for consumers of an estimated Rs5 billion.
APAT general secretary Naeem Mir warned the government that trader will approach the court against this illegal decision of the government which refused to approve another major reduction of up to Rs17 in petroleum prices on recommendations of Oil and Gas Regulatory Authority (OGRA). Naeem Mir said that oil prices at international level have dropped by over 45 per cent but the govt has not passed on this benefit to the consumers as just 20 per cent cut has been announced so far. “When the rates go upward govt makes OGRA responsible for this hike and refuse to interfere but now the authorities are interfering and have become hurdle to facilitate public. It seems that government was reducing the rate of oil due to pressure of PTI sit-ins as the govt has now imposed additional levy on petroleum instead of giving full benefit of international oil price cut as the sit-ins are no more continuing.” The government, under the article 77 and 162 of the constitution, cannot impose tax without the approval of parliament but it is imposing new taxes through SROs unconstitutionally and the recent Supreme Court’s decision has stopped this illegal practice of the govt in the past.
LCCI President Ijaz A. Mumtaz said that repeated cuts in petroleum prices shows present regime’s seriousness in putting the economy back on rail.  He said that reduction in POL prices would certainly bring down the cost of doing business and Pakistani products would get their due share in the international market.  He said that recent decision would not only give breathing space to the industrial sector but would also help agriculture sector prosper. LCCI former vice president Kashif Anwar observed that Pakistan agriculture sector is engine of growth. The decrease in petroleum prices would bring down the input cost of agriculture production as high speed diesel is being used in tractors, tube-wells, harvesters, thrashers and other agriculture machinery.
He urged the government to bring down the electricity prices as well as government is producing huge amount of electricity through thermal means and after cut in petroleum prices, prices of electricity would should be at lowest. He said that at a time when the whole industry was suffering due to energy crisis and high cost of doing business, massive cut in petroleum prices, whole scenario would take a positive change.