Terming the Gas Infrastructure Development Cess (GIDC) 'unconstitutional' and `unilateral', Sindh Chief Minister Syed Qaim Ali Shah on Friday urged the federal government to withdraw the levy. He told the legislators during a budget speech at Sindh Assembly that the provincial government had to cut development expenditures because the federal government could not achieve its revenue target in the current fiscal year.
"It is because of poor tax collection made by the federal government that Sindh government has no choice but to slash its development expenditure," he added. Accusing the federal government of levying GIDC 'unilaterally', the CM said that the federal government had acted against the 'spirit' of Constitution's Articles 161 and 172.
"The Federal Government has not only levied this cess on a natural resource without the Constitutional mandate, but through the current Finance Bill, they proposed enormous increase in its rates also," he opined. He demanded of the federal government to withdraw the `unconstitutional' cess, ensuring that duties and taxes on gas must be imposed after discussing the same with provinces.
About the cut made in the ADP, Shah said that Sindh government has evolved a plan to efficiently utilise the available funds on prioritised schemes. "We have succeeded in completing a record number of 605 schemes in the ongoing fiscal year,' he added. He told the house that lack of fiscal decentralisation has made the Sindh government 'heavily' dependent on federal government for transfer of its revenues. "These transfers remained highly unpredictable as targets for FBR were revised downward twice during the ongoing fiscal year," he explained.
He also pointed out that the initial target of the FBR was fixed at Rs 2475 billion. "It was first revised downwards to Rs 2345 billion and then further revised to Rs 2275 billion in May 2014," he added. He said the Sindh government's share in federal transfers as per budget estimates 2013-14 of Rs 409.013 billion was curtailed to Rs 388.634 billion of which Rs 3217.218 billion the province received till date. "Which means a shortfall of Rs 81.795 billion against the original estimates and Rs 61.416 billion against the revised estimates," he said.
He proposed the collection of sales tax on goods should be devolved to the provincial governments. He also demanded that the collection of Zakat and administration of Old-age Benefit and workers' welfare funds should be devolved to Sindh as per the 18th Constitutional Amendment. "Both subjects have been devolved to the province after the 18th Amendment, but the implementation is being delayed despite several requests made by Sindh government," he said.
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