November 11, 2003	Tuesday	Ramazan 15, 1424

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ISLAMABAD, Nov 10: Finance Minister Shaukat Aziz on Monday conceded before the National Assembly that the pay allowances and fringe benefits of the employees of Zarai Taraqiati Bank (ZTBL) were less than the employees of the scheduled nationalized banks.

The minister said pay allowances and fringe benefits of the ZTBL were determined by its Board of Directors (BoD) keeping in view different financial parameters and profitability. Further increase in pay and allowances will be considered by the BoD in the light of the institution’s financial viability.

To another question, the minister said the ZTBL had also adopted the relief package announced by the government during 2002 under which borrowers availing loans up to Rs25,000 were allowed full remission/write-off in all provinces except Balochistan where this facility was admissible only to the loans amounting to Rs50,000.

He said under clause 52 of Part-I of the Second Schedule to the Income Tax Ordinance, 2001, sumptuary allowance received by the provincial governors, the chiefs of staff Pakistan armed forces and the corps commanders were exempted from income tax.

Similarly, the sumptuary allowance received by the federal ministers was also exempted from income tax under clause 53-d of the same schedule.

Meanwhile, the list of exempted allowances of salaried persons include children’s allowance (clause 16) which was received by the families and dependents of ‘Shaheed’ (martyr) of the Pakistan armed forces, children’s allowance (clause 17) received by the families and dependents of ‘Shaheeds’ belonging to civil armed forces and compensatory allowance (clause 35) received by a Pakistani citizen locally recruited in Pakistan mission abroad which does not exceed 75 per cent of his gross salary.

It also includes conservancy allowance (clause 49) received in lieu of free conservancy by persons below commissioned rank of the armed forces or territorial forces and flying allowance (clauses 42, 43 and 44) received by pilots, flight engineers and navigators of a Pakistani airline, Civil Aviation Authority, the airforce and navy.

Similarly, flying allowance (clause 45) received by junior commissioned officers or other ranks of the armed forces was also exempted from income tax.

Another allowance falling in this category is medical allowance (clause 139-a) provided to an employee in accordance with the terms of employment agreement provided National Tax Number of the hospital or clinic is given and the employer also certifies and attests the medical or hospital bills.

Similarly, ration allowance (clause 47) received by a member of the armed forces or territorial forces, rent allowance (House clause 53-h) granted by the government in lieu of rent free accommodation to a minister of the federal government, rent allowance (House clause 55) granted by the federal government to a judge of the supreme court or a high court who chooses to reside in a house not provided by the government, rent allowance (House Rule 5) received by an employee subject to the condition that the employer provides no accommodation or housing and the income chargeable under the salary is below Rs600,000.

Likewise, allowances exempted from income tax are superior judicial allowance (clause 56-1b) received by a judge of a high court, transfer allowance (clause 56-1c) received by a judge of the supreme court or high court, travel allowance (Local clause 40) received by a newspaper employee in accordance with the decision of third wage board for newspaper employees and travel allowance or subsistence (Within Pakistan Rule 7-1i) availed by an employee in accordance with the terms of employment and the income chargeable under salary.