The government had forgone tax revenue of Nu.84.242 MN from transporters hired by the mining companies. This was one of the key findings in the Performance Audit Report on tax of mining and quarrying sector from 2008-12.
The Royal Audit Authority had come up with the report as per the directive from the National Council.
The Members of the Upper House pointed out that such lapse occurred because of the inconsistency between the Income Tax Act and Rules on the Income Tax Act 2001.
The Income Tax Act 2001 says, income from the other sources shall mean income from hire of privately owned vehicles, plant and machinery and from intellectual property rights. However the rules on Income Tax Act states exclude trucks and taxis.
The NC MPs said such provision has given the opportunity for a few individuals to evade tax despite earning huge amount from the hire of private trucks. MPs expressed that the provision in the Rules should be removed and the Income Tax Act 2001 should also be amended.
