ISLAMABAD: In bid to ensure tax refunds in the month of April 2018, Prime Minister Shahid Khaqan Abbasi has decrease d Federal Board of Revenue’s (FBR) tax collection target for the ongoing fiscal year by Rs113 billion.
The decision was taken during a meeting chaired by the prime minister and attended by his advisers, Haroon Akhtar Khan and Miftah Ismail. They decided to fix a new target tax collection of Rs3,900 billion.
It is pertinent to mention that the FBR was facing Rs100 billion shortfall as the country’s to revenue authority has estimated to collect Rs3,900 billion by the end of ongoing fiscal year. The FBR was facing this shortfall despite showing healthy growth of over 17 percent in tax collection during the last eight months.
However, the recent rupee depreciation against US dollar would improve the tax collection at the import stage that includes custom duties, regulatory duties, sales tax and withholding tax.
The government had set the tax collection target at Rs4,013 billion for the current fiscal year. The FBR has recorded a provisional net revenue collection of over Rs2,259 billion during first eight months (July to February) of the current financial year as against Rs1,920 billion collected during the same period of the previous fiscal year, excluding collection on account of book adjustments.
FBR has recorded an increase of around 17.65 percent over the revenue collected during the corresponding period of last fiscal year.
The tax collection would remain Rs55 billion lesser than the target approved by the parliament. The tax collection is expected to reach Rs3,958 billion as against the previous target of Rs4,013 billion.
Earlier, the government had revised the target to 5 percent of the GDP from 4.1 percent of the GDP (Rs1.48 trillion), approved by parliament in June last year. The government had restricted the budget deficit at Rs796.3 billion (2.2 percent of the GDP) during first half (July-December) of the current fiscal year.
