Clarification sought on governments' powers to tax services under FEA

The Deputy Attorney General of Pakistan has asked the Law and Justice Division and the Federal Board of Revenue (FBR) to clarify whether province or the federation has exclusive power to tax services under Federal Excise Act (FEA) 2005 after the 18th Amendment.
Sources told Business Recorder here on Monday that writ petitions have been field in Lahore High Court. One set of petitions has been filed by airline companies to assail the vires of Punjab Sales Tax on Services Act, 2012 as being violative of Article 142 read with entry 53 of the Federal Legislative List. In the second set of petition filed by companies the payment of Federal Excise Duty on franchise services, etc, under the Federal Excise Act, 2005 has been challenged on the ground that after 18th Amendment, tax on services can only be levied by the province. The section 3 (1) (d) of Federal Excise Act, 2005 has been challenged.
After the 18th Amendment of the Constitution, it is a complex legal issue that has arisen. It is whether the tax on services is to be levied by the provincial legislature only or whether the same may be taxed by the federal government under the Federal Excise Act, 2005. In case some or all services are taxed under the Federal Excise Act, 2005 then by the virtue of Article 143, the provincial legislature may not be able to impose the tax on such services, the deputy AGP said.
Furthermore, if the service originates in one province but concludes in any other province then whether the inter-provincial service may not be taxed by province under Article 151 of the Constitution, as it relates to inter-provincial trade and commerce, he questioned.
Lastly, the federation may consider whether it wishes to tax inter-provincial services, but leave out the services that are rendered exclusively within domain of one particular province. Such an arrangement may be in accordance to the scheme envisaged in Federal Legislative List as matters relating to the inter-provincial trade and commerce, companies on entitles that are trans provincial/inter provincial or are governed by federal laws.
Express instructions from the federal government are required as to whether the federal government wished to tax services after the 18th amendment and if so, which services it wants to tax. Secondly whether the province or federation has exclusive power to tax services, the Deputy AGP added.