ISLAMABAD: The government’s revenue collection in the first quarter of this fiscal year surpassed the target despite missing the monthly target in September, latest data released by the Federal Board of Revenue showed on Wednesday.
Revenue collection in September stood at Rs401 billion, missing the monthly target of Rs418bn by four per cent. Meanwhile, the collection increased by 5pc from Rs381bn in September 2019.
Moreover, the government is likely to book additional revenue after book adjustments and reconciliation.
During July-September, the FBR collected Rs999bn as against the projected target of Rs970bn for the same period; surpassing the target by over Rs29bn or 2.9pc.
First quarter collection exceeds projection; return filing deadline extended
The payment of Rs48bn refunds in the first quarter -- an increase of 59pc over last year’s payment of Rs30bn -- showed a sharp acceleration in economic activity, leading to revival of industrial production in the post-Covid period.
The government, while preparing the budget for the ongoing fiscal year, had assured the International Monetary Fund (IMF) to raise Rs4.963 trillion in FY21 against Rs3.989tr collected in FY20 -- a projected increase of 24.4pc.
However, the government is yet to come up with a plan to raise the additional revenue of Rs974bn to meet the target.
Income tax collection during the first quarter fell short of target by Rs1bn to Rs361bn as against Rs362bn collected during the same months last year. The income tax collection target for the quarter was Rs381bn, which was missed by Rs20bn.
Revenue realisation of income tax is much below the expectation despite introduction of several measures.
Meanwhile, sales tax collection during July to September reached Rs477bn against last year’s Rs422bn, showing a growth of 13pc. The projected target for the sales tax collection was Rs396bn — lower than last year’s collections during the same months. The impressive sales tax collections came as a result of rise in POL prices and revival of economic activities in September.
The federal excise duty (FED) collection reached Rs58bn as against Rs51bn last year, showing an increase of 15pc. The FED target for the first quarter was set at Rs58bn.
Moreover, customs collection in the quarter reached Rs151bn as against Rs159bn collected over the corresponding months of last year, showing a decline of 5pc. The government had projected a revenue target of Rs134bn for the months under review.
Following the slowdown in Covid-19 infections, the economic activity in the country is now being revived through multiple economic stimuli and relief measures. Collections in September show that the dutiable imports have also shown an increase. The overall sales tax collection in September posted a growth of 14pc when compared with the same month last year.
In another late night circular, the FBR extended the deadline for filing of income tax returns for individuals and companies till December 8.
Published in Dawn, October 1st, 2020