Lahore  - The recent increase in duty on import of coal from 1 percent to 6 percent has adversely hit the local manufacturers and has drastically increased cost of doing business.

The APCMA Chairman Muhammad Ali Tabba has asked the government the increase in import duty on coal should be reduced to zero percent as this would keep open the option of using coal as alternative source of energy. ‘The government had enacted the Gas Infrastructural Development Act of 2011 (2011 Act), whereby the government charged a cess to all gas consumers except those of the domestic sector,’ he added.  

The 2011 Act was subsequently challenged and held to be ultra vires to the Constitution of Pakistan and the Supreme Court also declared that cess is a “fee” not a “tax” and that all amounts charged under the 2011 Act were to be refunded and/or adjusted in monthly bills within 6 months of the judgment i.e. 22nd August 2014.

Subsequently, he added, the government promulgated the Gas Infrastructural Development Ordinance 2014 (2014 Ordinance) which via Section 8 of the 2014 Ordinance attempts to make all amounts collected under the 2011 Act to be validly collected. ‘The 2014 Ordinance was originally to expire in January, 2015 but was extended by the National Assembly till May, 2015,’ he added.   In May 2015, he added, the government passed the GIDC Act 2015.

A Suit in the Sindh High Court (SHC) was filed, challenging the levy of GIDC as well as its retrospective effect. SHC granted a stay against charging of the GIDC under the 2015 Act on the first date of hearing.

‘We request that the charge/levy GIDC should be abolished ab-initio. It has increased the cost of doing business of the industrial sector. Further in current market scenario of declining fuel prices including liquefied natural gas in the international markets it will render domestic products uncompetitive in export markets,’ said Chairman Apcma.