Sindh has accused the federal government of not being serious in resolving the issue of 'reformed general sales tax' (GST) as the Centre has yet to convene a meeting to deal with Sindh's reservations. An official of Sindh government said that all technical modalities with respect to implementation of 'reformed GST' have been finalised and the federal government is now required to convene a meeting of the political leadership to finalise the proposal.
The official also criticised the Finance Ministry for convening a Secretary level meeting on Tuesday without any agenda. As a protest, instead of Secretary Finance, Sindh, Additional Secretary Finance attended the meeting because the province believes that there was no need to convene a Secretary level meeting. He said that the province will not agree to implement 'reformed sales tax' on services after October 1, as stated by the Finance Minister in his budget speech. According to him, Sindh government had written two letters to the federal government requesting a meeting to resolve the issue at a political level.
Resistance by the Sindh Province on the levy and collection of 'reformed' GST on services compelled the federal government to delay the introduction VAT from July 1, 2010, as committed in its letter of intent submitted to the IMF Board, to October 1, 2010. Prime Minister Yousaf Raza Gilani formed a committee with finance secretaries and private members of the provinces in National Finance Commission in the chair to finalise the technical modalities for the introduction of integrated reformed GST from October 1, 2010. Sindh Province claims that technical modalities with respect to implementation of reformed GST have been finalised and Finance Ministry was not convening a meeting to ensure political agreement with the proposed measures.
Sindh government representative Qaisar Bangali told this scribe that his province would not give up its constitutional right to collect GST on services. However, the high-ups of federal government have argued in favour of uniform implementation of reformed GST with one collecting authority at federal level to avoid complications. Sources said that there is immense political pressure on Sindh government not to compromise on this issue.
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