Increase in levy taxes struck down by Supreme Court

ISLAMABAD: The Supreme Court of Pakistan has ruled that the prime minister cannot bypass the federal cabinet and approve any ordinance without its approval. With the same pen the SC has also declared the government’s notification increasing levy tax as null and void.


A three-member bench of the Supreme Court headed by Justice Saqib Nisar while hearing the appeal against the increase in petroleum levy being declared null and void; delivered an 80-page verdict.

The verdict declared, that the government has the authority to increase or decrease taxes, however the federal cabinet requires time for legislation. No bill can be presented in the parliament for approval until approved by the federal cabinet and the prime minister cannot bypass his cabinet when it comes to legislation, the verdict adds.

The SC verdict further ruled that the restrictions outlined in the 1973 Rules of Business apply to the government and cannot be ignored. The prime minister, federal ministers or secretaries are part of the government but not the government themselves which comprises the federal cabinet and the prime minister.

The Supreme Court verdict further adds that changes in budgetary expenditures, the government’s discretionary powers and decisions on financials cannot be taken by the prime minister alone.

Therefore the government’s levy tax notification is null and void since it was not passed by the federal cabinet.

If the prime minister approves any such law without the federal cabinet’s approval, it will be deemed null and void and will have no legal value, the verdict adds. In the same light any increase in taxes by the federal secretary, revenue division or by a minister will be deemed null and void.