A highly controversial decision


So much for cheap fuel

The government tends to transfer the financial costs caused by its own inefficiency or questionable policies to the general public. In December last the government’s failure to check attacks on gas pipelines by terrorists combined with the gas companies’ incompetence to stop gas theft led to the hiking of the system losses in gas tariff by 2.5 to 7 percent. The additional revenue impact of over Rs15 billion was then discreetly passed on to the consumers. This time, after collecting over Rs160 billion as Gas Infrastructure Development Cess (GIDC) from consumers in the name of laying gas infrastructure, the finance ministry reportedly utilised the funds instead for balancing the budget to remain in the good books of the IMF. Now it is hectoring a reluctant OGRA to allow the government to recover Rs101 billion more from gas consumers once again for LNG pipeline.

The decision taken in the ECC is highly unjust for a number of reasons and is likely to give birth to a nationwide controversy. What is the moral or legal justification for taxing the consumers twice for the same thing? Was it legal on the part of the government to divert funds collected earlier for building gas infrastructure to other heads? Why doesn’t the government collect taxes from tax dodgers among the trading community, instead of providing them incentives to whiten their black money? The move is obviously politically motivated as the government is reluctant to lose the votes of an important section of its constituency. The government thinks the consumers who do not have a voice in this country can be forced to pay more.

Since the LNG will be used for power generation in Punjab, the cost will also be recovered from electricity consumers, which will push up the electricity tariffs. The increase in prices of all goods where LNG is used for production including fertiliser will also go up. And all this when the country was being promised the cheapest fuel.


  1. A very timely and just Editorial. This is a very shameful decision by the Ruling party ( specially by the Finance Minister who has his flourshing business in UAE). As mentioned in the Editorial, the Finance Ministry has shamelessly failed to expand the Tax-net. The biggest hurdle in the way of expanding the tax-net is the FBR itself – in collaboration with the Rich Mafia of the coutry – as mentioned by one of the leading English Newspaper of Pakistan. Billions of Dollars are also being siphoned out of the country through the 'money mules' like Ayan Ali – and they are not one or two, they are 20 to 25 as pointed by PPP's Dr Asim. Mr Daar is awaiting the curse of the poor people of the country – of Allah if not the people.

Comments are closed.