ISLAMABAD - Federal Board of Revenue has set Rs 1.377 trillion revenue target for the next financial year 2009-10, which is Rs 69 billion more than that of the last fiscal year 2008-09. The government has enhanced the federal excise duty (FED) on locally produced cigarettes in different slabs in order to increase the revenue and it is estimated that Rs 15 billion would be achieved by increasing FED on cigarettes. As revenue measures and to broaden the tax base, 16 per cent FED in value added tax (VAT) mode is proposed to levy additional service on fee charged by banking service, import cargo handlers, stock brokers, insurance companies and electronic media for advertisement, and the estimated revenue impact of these measures is Rs 16 billion. FED on petroleum products is being levied in the shape of carbon tax surcharge, which would eliminate the existing petroleum development levy. This would ensure transparency in the pricing of petroleum products, curbing consumption, saving foreign exchange and reducing carbon emissions. It is proposed to enhance the rate of withholding tax on the imports of commercial nature from 2 to 4 per cent and by doing this, tax authorities estimate to collect Rs 23 billion in 2009-10. To broaden the tax net, it is proposed to enhance the rate of capital value tax on property from 2 to 4 per cent and it is estimated to generate revenue of Rs 15 billion. In order to raise funds for the rehabilitation of IDPs of Swat, Dir, and Buner, it is proposed to charge 5 per cent tax on tax payable by individuals whose taxable income exceeds one million rupees. To support the IDPs in their rehabilitation, a new tax is being proposed to be charged on bonus income of corporate executive at 30 per cent of the bonus and this would be one-time levy and payable for only 2009. While the scope of advance tax collection on purchase of new locally manufactured motor jeep is proposed to be extended to all types of motor vehicles. According to the figures, FBR has fixed the revenue target at Rs 1.377 trillion for the next year. The break-up of the tax shows that Rs 557.3 billion is estimated as direct taxes from which Rs 536.23 billion would be obtained from income tax, Rs 13.86 from workers participation tax and Rs 7.21 billion from capital value tax. Similarly Rs 955.76 billion are calculated to be obtained from indirect taxes. The break-up of indirect taxes revealed that Rs 167.2 billion would be achieved from custom duty, Rs 515.6 billion from sale tax, Rs 137.4 billion from carbon surcharges on POL, Rs 12 billion from carbon surcharge on CNG, Rs 1.5 billion form Islamabad Capital Territory taxes, while Rs 60 million from airport taxes. It is proposed that getting national tax number (NTN) might be made mandatory to purchase property, obtain commercial and individual gas/electricity connection and opening account. While all NTN holders are also proposed to file returns necessarily, otherwise strict action would be taken against them. On the other hand, government has eliminated 5 per cent FED on motor cars aimed to lowering the prices that would boost their demand and stabilise the local automobile industry. FED on telecommunication services has also been decreased from 21 to 19 per cent, and the activation charges of cellular phones are reduced from Rs 500 to Rs 250. In order to provide boost to the cement industry, FBR decreased the FED on cement from Rs 900/PMT to Rs 700/PMT, and this would encourage the construction activities in the country. The basic limit of exemption from income tax in respect of salaried persons is proposed to be increased from Rs 180,000 to Rs 200,00 for men, while for the women the limit is proposed to be raised from Rs 240,000 to Rs 260,000. Similarly for the senior citizens limit of taxable income is increased to Rs 750,000 from Rs 500,000 in view of inflationary trend. Government has also provided concession on pharmaceutical raw materials, lifesaving drugs and cancer diagnostic, reduced the duty on mobile phones from Rs 500/set to Rs 250/set and also removed regulatory duty of Rs 250/set. The other exemptions given to the different items included duty on calf milk replacer (CMR) from existing 20 per cent to zero per cent, reduction of duty from 10 to 5 per cent on raw materials for manufacturing pre-fabricated steel buildings, reduction of duty on import of kits for 4-stroke auto-rickshaws from 32.5 to 20 per cent. While the government continued exemption of duty on import of agricultural tractors. The FBR is also considering collecting Rs 7 to Rs 8 billion from administrative improvement measures. In order to provide protection to the local industry, the following duties have been increased; duty on hydrogen peroxide from 5 to 10 per cent, duty on Isobutyl Acetate from 5 to 20 per cent, duty on welded stainless steel pipes from 5 to 15 per cent and duty on multi-system air conditioners of capacity 5 tonnes and above from 10 to 35 per cent. Similarly measures like exemption of duty on import of linear alkyl benzene from 5 per cent, increase of duty on import of spark plugs and wire condensers from 5 to 10 per cent, increase in duty on plastic sanitary ware from 20 to 25 per cent, continuation of 5 per cent CD rate on SKD kits for LCD/Plasma TVs manufacturers for a further period of one year are taken. Likewise, the duties on the import of solar equipment and steel tubes for manufacturing CNG cylinders have been exempted, while duty on tufted carpets has been raised from 10 to 15 per cent.