It argued that the government had already collected Rs10 billion higher revenue on account of GST in the first eight months (July-Feb) of the current financial year, compared with the same period last year, and hence an additional impact of Rs3 billion
on account of international prices could be adjusted against higher GST collections.
A senior government official told Dawn that the special parliamentary committee decided to provide a subsidy of Rs15 billion on petroleum products till June 30 to be shared equally by the federal and provincial governments. Since the provincial governments were not on board, the committee decided that they should be asked to contribute Rs7.5 billion so that the prices of other products could also be subsidised in view of the fact that the GST was part of common revenue.
Chairman of the Committee Minister for Water and Power Syed
Dr Abdul Hafeez Shaikh and secretaries of finance and water and power and the Ogra chairman.
“The committee considered various options and keeping in view the budget deficit and tax collection, it has been decided to provide a subsidy of Rs2.80 per litre on HSD to absorb the impact of higher international prices. The subsidy would be paid out of federal budget”, Mr Qamar told newsmen after the meeting.
He said the provinces would be consulted in a few days and with their contribution the subsidy would be extended on other products till June 30.