ISLAMABAD: The Federal Board of Revenue (FBR) raised a record Rs5.349 trillion in the first 11 months of 2021-22. However, the collection fell short of the projected target by Rs18 billion, showed provisional data released on Tuesday.
Compared with the revenue collection of Rs4.164tr in the same period in 2020-21, a 28.5 per cent growth was posted in the July-May period.
The collection in May stood at Rs490 as the FBR missed the target by Rs21bn. However, it rose by 26.8pc from last year’s Rs387bn.
The provisional figures will further improve after the closure of payment receipts and reconciliation with the State Bank of Pakistan.
FBR misses projected target for first 11 months by Rs18bn
The statistics show that the collection not only fell short of the targets in March and April but also posted a relatively low growth over the last year. Unprecedented in the FBR’s history to consecutively surpass the monthly collection targets in the first eight months (July to February) of 2021-22.
As a result, no change in petroleum products was made for the next 15 days by the government as well until May 26. The former government of PTI has set aside Rs466bn for these subsidies until the end of June.
An official announcement of the FBR said sales tax on all POL products has been reduced to zero costing Rs45bn in May.
Major growth in revenue collections is at the import stage — customs duty, sales tax, withholding tax — mainly because of the unprecedented growth in imports in 11MFY22.
The PTI government had already revised upwards the revenue target to Rs6.1tr to keep the budget deficit at a committed place. It, while preparing the budget for the current fiscal year, had assured the IMF of raising Rs5.829tr in FY22 against Rs4.721tr collected in FY21.
For achieving the revised target, the FBR will have to collect more than Rs750bn in June.
The gross collections including refunds and rebate payments increased by 28.6pc from Rs4.389tr during July-May FY21 to Rs5.644tr in 11MFY22.
An amount of Rs296bn was refunded during July-May compared to Rs224bn paid last year, an increase of 33pc.
Likewise, the refund payments in May increased 42.85pc to Rs30bn. This is reflective of FBR’s resolve to fast-track refunds to prevent liquidity shortages in the industry.
With the rising import bill coupled with an increase in imports of smuggling-prone items on legal channels, customs collection stood at Rs884bn in 11MFY22 as against Rs660bn last year, indicating a of 34pc. The annual customs collection target is Rs917bn, which according to customs officials, will not only be surpassed but will come close to Rs960bn even though no policy measures have been taken so far.
The income tax collection in 11MFY22 stood at Rs1.893tr as against Rs1.473tr over the same period last year, indicating a growth of 29pc. Very nominal IT refunds were paid during the months under review as it stood at Rs13bn this year against Rs15bn last year. The income tax collection target was projected at Rs1.910tr which was missed in 11MFY22 by Rs17bn.
Meanwhile, the sales tax collection jumped to Rs2.281tr from Rs1.779tr in the same period last year, showing a growth of 28pc. The growth came as a result of the highest-ever rise in fuel prices, increase in imports and revival of economic activities during the period under review.
The sales tax target was projected at Rs2.291tr which was also missed by Rs10bn during the period under review.
The Federal Excise Duty collection was up 15pc to Rs289bn in 11MFY22 as against Rs252bn in the corresponding period last year. However, the collection fell short of the target by Rs5bn.
Published in Dawn, June 1st, 2022