ISLAMABAD: Federal Board of Revenue (FBR) Chairman Tariq Bajwa has taken finance secretaries of all the four provinces into confidence over the impending revision to the annual revenue target and urged them to prepare financial plans in the light of revised revenue collection target for the remaining period of 2013-14.
According to details, in a meeting the FBR chairman informed the provincial finance secretaries that tax collection target of Rs2,475 billion for 2013-14 may be revised downward to Rs2,345 billion in view of low collection, especially customs duty and federal excise duty (FED) against required revenue growth of 21 percent to meet budgetary target.
He also briefed them on revenue collection and prevailing scenario.
The meeting decided that all four provincial governments would prepare their financial plans in the light of revised revenue collection target for remaining period of 2013-14 to ensure that federal and provincial governments will be on the same page. The FBR chairman informed the Provincial Finance Secretaries that out of the four components of the federal taxes i.e direct taxes, sales tax, customs and federal excise, the growth in the customs and federal excise was comparatively low.
He revealed that the tax collection target of Rs2,475 billion for current fiscal year was calculated by allowing growth of 21% on the revised estimates of Rs2,050 billion for fiscal year 2012-13. However, the actual collection was Rs1,946 billion. Therefore, for current financial year, a revised target of Rs2,345 billion may be expected, Tariq Bajwa said.
The meeting was informed about the profile of federal transfers to provinces from July, 2013 to February 17, through a presentation which was observed to be satisfactory by all the provinces. However, Finance Secretary Sindh raised a point about timeliness of payment of arrears. On this, Chairman FBR clarified that the figures conveyed to Finance Division on fortnightly basis were and the process of reconciliation of collection with various stakeholders i.e AGPR and banks takes much time. However, FBR is trying to reduce the time lag involved and it is expected that it would be reduced to the maximum possible. However, he emphasised that a procedural time lag of 15-30 days may continue as unavoidable due to the routine process of reconciliation.
The meeting discussed the fiscal performance by all Provincial Governments in terms of provincial revenue receipts and trends of current & development expenditures during first seven months (July, 2013-January, 2014) of current financial year (2013-14).
On the occasion, the Federal Finance Secretary concluded the meeting with the remarks that fiscal performance of the Federal and provincial governments remained satisfactory. While highlighting positive trends of the economy he quoted the improved trend in GDP growth, improvement in exchange rate, decreasing trend of inflation, successful completion of second review of economy with IMF Mission and well-controlled fiscal position.
Referring to a decision of CCI, the Finance Secretary lauded the provinces of KPK and Balochistan for maintain sufficient cash balance with the State Bank of Pakistan during first and second quarters of current financial year whereas Sindh also joined during second quarter for which these governments had been suitably rewarded.
