June 6, 2003	Friday	Rabi-us-Sani 5, 1424

ISLAMABAD, June 5: The revenue loss in lieu of major tax exemptions to national kitty has declined by 11.4 per cent to Rs21.89 billion in 2002-03 from Rs24.71 billion over the corresponding year.

According to the survey report of 2002-03 released here on Thursday, the total number of income tax exemption in the income tax law is 114. The cost of these exemptions excluding the agriculture income that is liable to tax under the relevant provincial agriculture income tax law was Rs6.8 billion this year, which was reduced from Rs10.2 billion in the year, a decrease of 33 per cent.

Further break up showed accumulated loss from pension was estimated at Rs0.7 billion in 2002-03; allowances Rs1.1 billion; income from funds Rs0.6 billion; National Saving Scheme (NSS) interest income Rs2.7 billion; other interest income Rs0.1 billion; capital gains Rs0.9 billion and sector and enterprise specific exemption at Rs0.7 billion.

On the other hand, the sales tax exemptions increased by 20.6 per cent to Rs10.37 billion in 2002-03 from Rs8.60 billion over the corresponding year.

The major exemptions on sales tax are food items— wheat, grain, pulses and edible oils excluding palm oil and soybean oil. In addition to food items exemptions also include phosphatic fertilizer, information technology equipment and pharmaceutical products.

The customs exemptions have declined by 13 per cent to Rs4.71 billion during the year 2002-03 from Rs5.41 billion revenue loss under the same head of last year.

The report says, the customs exemptions are mainly given on raw materials and components-plant, machinery and equipment imported by high tech industry, priority and value added industries, imports for energy sector projects exemption to exploration and production companies including OGDC exemption for Wapda and imports by CNG companies. Some of these exemptions are on account of international commitments and contractual obligation, added the report.