ISLAMABAD, June 12: The revenue loss to the national kitty, because of major tax exemptions, has declined by 15.8 per cent to Rs19.6 billion in 2003-04 against Rs23.3 billion over the corresponding year.

According to the Economic Survey Report 2003-04 released here on Friday, the total number of tax exemptions under the income tax ordinance were 100, which cost Rs6.15 billion during the year under review against Rs6.80 billion in the last year, indicating a decrease of 9.5 per cent.

Under the income tax, the exemptions were mostly related to National Saving Schemes, pensions, provident funds and superannuation funds. The government had already withdrawn 57 income tax exemptions during the last two years.

Further break up showed that accumulated loss occurred due to Pensions stood at Rs0.70 billion in 2003-04, allowances Rs1.10 billion, income from funds Rs0.60 billion, NSS interest income Rs2 billion, other interest income Rs0.1 billion, capital gains Rs0.95 billion, sector and enterprise specific exemptions Rs0.7 billion.

The sales tax exemptions declined by 10.97 per cent to Rs9.25 billion in the year 2003-04 against Rs10.39 billion in the corresponding year. The break up of sales tax exemptions showed that revenue loss to retailers (including those in turnover scheme) stood at Rs0.20 billion in 2003-04, manufacturers Rs0.35 billion, edible oils Rs0.85 billion, pharmaceutical (excluding life saving drugs) Rs4.60 billion, tractors and other agriculture machinery Rs1.75 billion, fertilizers Rs0.69 billion, pesticides Rs0.5 billion, exemption on machinery Rs0.21 billion.

The exemptions available under customs declined by 24.8 per cent to Rs4.211 billion during the year 2003-04 against Rs5.603 billion in the corresponding year.

Further break up showed that exemptions in the customs duties available under different SROs showed that an amount of Rs1.225 billion revenue loss occurred in 2003-04 to the national kitty due to customs exemptions available under SRO 387 of 1994, a revenue loss of Rs128 million due to SRO438 of 2001, an amount of Rs511 million due to SRO439 of 2001, an amount of Rs338 million due to SRO357 of 2002 and Rs2.011 billion due to SRO358 of 2002.

The exemption available under central excise duty declined by 99.60 per cent to Rs0.002 billion in 2003-04 against Rs0.50 billion of the last year. The total cost ofcentral excise exemptions stood at Rs2.25 million in the year 2003-04. This exemption was granted to the Aga Khan Development Network for the Aga Khan Hospital and Medical College, Karachi on the purchase of cement for the construction of the oncology and laboratory building.