June 9, 2003	Monday	Rabi-us-Sani 8, 1424

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ISLAMABAD, June 8: The government has waived the penalty imposed on around 2,000 companies for not paying the corporate asset tax for the last many years.

Central Board of Revenue (CBR) official spokesman and member of direct taxes Vakil Ahmed Khan told newsmen that the decision was taken following the observation that due to the inefficiency of income tax officials, revenue was not being collected from companies in time, which had resulted in huge penalty on them, besides the principle amount of tax.

He said that in this regard, the government had fixed Sept 30, as deadline for all the companies to deposit the principle amount tax without any penalty on it. The date could not be extended, he added.

Mr Khan said that all the concessions in duties and taxes announced in the budget would result in a Rs9.7 billion loss to the national exchequer annually.

However, he said the loss would be mainly covered through the levy of 20 per cent GST on edible oil seeds and 39 raw materials at import stage and other taxation measures, besides through nine per cent growth in the taxes.

The spokesman said proper monitoring of withholding taxes and introduction of the universal self-assessment scheme, to be effective from July 1, would also help enhance revenue.

He said the 15 per cent raise in the salaries of government employees would also result in additional Rs800 million as income tax.

Mr Khan said the CBR would achieve Rs510 billion target set for year 2003-04.

He said rationalization of the duty drawback rates this year had resulted in a saving of Rs10 billion while more cuts would also help realize additional money.

Answering a question, he said there was still room for bringing more retailers under the sales tax net. He said that so far only 34,000 retailers were registered with the sales tax department.

EXEMPTION: The government has exempted the customs duty and sales tax on the import of machinery and equipment for pipeline projects in budget 2003-04.

Customs notifications released here on Sunday say the duty was reduced to five per cent from 10 per cent on the import of plant and equipment for setting up any new power generation project in the country.

The government has also amended the Power Generation Policy 2002, to include power generation projects (excluding captive power generation plans) being run through oil, gas, hydel, coal and renewable resources.

Under the amendment, the exemption of customs duty was allowed in excess of 5 per cent on the import of plant and equipment.

The policy is not applicable to the contractors of power generation companies and captive power producers, except to permanent imports. Temporary imports for the projects established under this scheme would also be subjected to full duties and taxes. The amendment would not affect projects under the previous policies.