ISLAMABAD - The Supreme Court was moved on Monday against increase in the General Sales Tax (GST) on petroleum products with the pray to immediately restrain federation from collecting extra amount with GST until the ruling on the petition.

Shahid Orakzai filed the petition under Article 184(3) of the Constitution and made federation through secretary Ministry of Law and Justice and chairman Oil and Gas Regulatory Authority (Ogra) as respondents.

The petitioner also prayed the court to declare the increase in Sales Tax on petroleum products unauthorised under the law and direct the Ogra to re-evaluate the price of petroleum products by the standard GST.

Orakzai questioned whether a tax imposed by a federal law could be increased without amending the law? And whether, the rate/percentage of GST can be increased specifically for a particular group of products.

The federal government on January 31, 2015 increased the GST on all petroleum products by 10 per cent. Resultantly, now it is 27 per cent of the cost of various carbon fuels. Regardless of purpose or intent the increase or ‘alteration’ in GST is utterly unconstitutional and absolutely illegal.

Firstly, the federation did not move a Money Bill in the National Assembly as required/emphasized by Article 73, wherein clause (2)(a) provides for ‘imposition, abolition, remission, alteration or regulation or any tax.’ The petition said that no tax could be imposed, abolished, remitted, altered or regulated without a Money Bill. Secondly, the GST under the law should be uniform sales tax.

It applies to all the products at a general rate and cannot vary from product to product. The petition stated the verbal increase in the GST by the prime minister is thoroughly illegal even though notified by the Federal Bureau of Revenue (FBR). “The latest increase from 17 per cent to 27 per cent, the Sales Tax on petroleum products is no more a General Tax but has now become a Special Tax.” “There is no Act of parliament which could impose or levy any Special Sales Tax exclusively on petroleum products.”

According to Article 77 says; “No tax shall be levied for the purposes of the federation except by or under the authority of Parliament.” Orakzai stated: “Special Sales Tax on petroleum products would have a serious fallout or GDP as revenue cannot increase if energy, work or GDP levels drop in the middle of financial year.”