ISLAMABAD: The Federal Board of Revenue (FBR) has missed the revenue collection target of the fiscal year 2016-17.
According to the FBR sources, the FBR has collected Rs 3,420 billion against the revised target of Rs 3,521 billion, which shows only 9 percent increase in tax revenue collections as compared to the financial year 2015-16. In the budget 2016-17, the revenue collection target was set at Rs 3,621 billion.
The collection shows a Rs 100 billion shortfall in the revised target of Rs 3,521 billion set by Finance Minister Ishaq Dar on May 26. It is expected that the final revenue figures will come out on July 3 (today).
During the financial year 2015-17, the FBR surpassed the revenue collection target of Rs 3,104 billion by collecting more than Rs 3,130 billion. However, the government has set a tax collection target of Rs 4.013 trillion for the current financial year (2017-18) which, under current circumstances, seems unrealistic.
Sources at the Finance Ministry told Customs Today that the government could face difficult situation and adverse reaction or questions from international donor agencies, especially the International Monetary Fund due to low tax to GDP ratio in the country.
The FBR has worked out the negative revenue impact of the decisions that the government took after setting the annual target. Failing to increase petrol prices resulted in a shortfall while the revision in the duty on fertilizers, abolition of zero-rating on five sectors and lower rates on pesticides also led to a loss in revenues.
