Payment of GST to Discos: Sindh resents ECC decision

The Sindh government has reportedly protested against a decision of Economic Co-ordination Committee (ECC) of the Cabinet regarding the payment of General Sales Tax (GST) to Discos on behalf of farming community, well informed sources told Business Recorder. The ECC, in its meeting on November 20, 2104, decided to charge Rs 10.35 per unit tariff from agriculture consumers except those who are under Quetta Electric Supply Company (Qesco). The ECC also decided that GST will be paid to Discos by the respective provincial governments.
The sources said Hyderabad Electric Supply Company (Hesco) has conveyed to the federal government that the Sindh government has refused to pay the GST on the plea that the decision of the ECC of the Cabinet was taken without the concurrence of the Sindh government.
According to sources, Hesco is of the view that the Sindh government will increase the financial burden of power sector which is already under pressure. Further, the Sindh government still has to pay Rs 301 million on account of GST for the same scheme implemented during 2013-14. The committee approved the proposal moved by the Ministry of Water and Power for allowing extension of subsidy to agriculture consumers @ Rs 10.35 per unit till June 30, 2015.
According to the earlier decision, Ministers of W&P and Finance had decided in a meeting with the representatives of Kissan Ittehad (in August 2013) to subsidise tariff for agriculture consumers whereby the federal government bore the tariff differential subsidy and provincial governments were directed to pay GST. The committee also decided that the GST will be adjusted against the electricity fee payable to provinces. It is also important to mention that during peak hours agri tube wells will not be entitled for power supply.
The amount paid in subsidy will be around Rs 22 billion which was around Rs 18.5 billion last year but the federal government has taken the decision to support farmers; with the help of this decision Punjab has given historic wheat production of 19.470 million of tons during 2013-14. The fuel price adjustment will also be paid by the federal government.