ISLAMABAD: Owing the likely shortfall of Rs180 billion in the revenue of divisible pool, the provinces are expected to receive around Rs100 billion less from the budgeted projection for the current fiscal year.
The share of provinces were projected at Rs1,380 billion in the current fiscal year from the divisible pool taxes but due to the shortfall in tax collection, now they are likely to receive around Rs1,280 billion. This was largely because of downward revision in FBR tax collection from budgeted Rs2,475 billion to revised target of Rs2,275 billion for the current fiscal year.
The divisible pool comprises direct taxes, sales tax, customs duty, export duties and federal excise duty. Under the NFC Award, provinces get 57.5 percent of the revenue collected by the FBR through the divisible pool. The FBR has estimated a revenue shortfall of Rs200 billion in the last quarter (April-June) of 2013-14 despite FBR Chairman’s assurance that Rs 2,270 billion to Rs2,275 billion will be collected by the end of current fiscal year.
On the basis of revised target of Rs2,345 billion, the downward revised revenue collection target for last quarter (April-June) 2013-14 was Rs775 billion. The revised revenue collection target for April 2014 was Rs 196.3 billion, May 2014 Rs219.5 billion and for June 2014 at Rs359.2 billion. However, the set targets have been further scaled down following second downward revision in revenue collection targets from Rs2,345 billion to Rs2,275 billion.
In March, the FBR collected over Rs209 billion against the target of Rs215 billion, reflecting a shortfall of Rs 6 billion. In April, the tax machinery collected Rs167 billion against the target of Rs199 billion in the corresponding period of April 2013, reflecting a shortfall of Rs32 billion. The provinces were informed by Finance Ministry on Wednesday (May 20) during bi-annual NFC meeting that from provincial share in the divisible pool taxes for July-December, 2013, following disbursements have been made: Punjab Rs294.69 billion, Sindh Rs 139.84 billion, KP Rs93.27 billion and Balochistan Rs61.63 billion.
