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The Gas Infrastructure Development Cess (GIDC) is a cess introduced by the government of Pakistan to for funding gas infrastructure projects.[1][2] The cess was applied to industrial sectors such as fertilizers, CNG, and power plants, but not directly to the general public.[3]
Its purpose is to finance the construction and maintenance of transnational gas pipelines, including the Iran–Pakistan gas pipeline, the Turkmenistan–Afghanistan–Pakistan–India (TAPI) Gas Pipeline, and various liquefied natural gas (LNG) projects.[3]
History
editIt was introduced in November 2011 under the Pakistan Peoples' Party government led by Asif Ali Zardari.[3] The GIDC was legislated as a Money Bill on November 25, 2011.[3]
The introduction and implementation of the GIDC were met with legal challenges from various industries, questioning its constitutionality and reasonableness.[3] These challenges led to multiple court cases, including in the Sindh High Court and Peshawar High Court, and eventually escalated to the Supreme Court of Pakistan.[3]
In a significant ruling on June 22, 2014, the Supreme Court declared the GIDC unconstitutional, stating that it could not be introduced through a Money Bill.[3] In response, the government enacted the GIDC Ordinance in October 2014, which was again legally contested.[3] This led to the introduction of the GIDC Act in May 2015, aiming to address the legal issues.[3]
Despite these legislative efforts, the GIDC Act continued to face legal challenges, leading to a series of stay orders against the billing and collection of the cess.[3] This legal contention resulted in the accumulation of unpaid GIDC arrears from its inception in January 2012 until December 2018.[3]
To address the accumulating arrears, the PTI government issued a presidential ordinance on August 28, 2019, which proposed a 50 percent waiver on the GIDC and a 100 percent waiver on accumulated interest, along with a payment plan for arrears.[3] This ordinance targeted sectors including CNG, fertilizers, and power generation, providing them the option to settle outstanding cess amounts under specified conditions.[3]
References
edit- ^ Kamran, Asad Ullah (December 12, 2022). "GIDC amounting to Rs448 bn stuck in limbo. What is the GIDC though?". Profit by Pakistan Today.
- ^ "What is GIDC? Here is everything you need to know about the Gas Infrastructure Development Cess".
- ^ a b c d e f g h i j k l m Ahmadani, Eleazar Bhatti, Ahmad (September 9, 2019). "Profit Explains: The GIDC saga". Profit by Pakistan Today.
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