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July 1, 2020

FBR fetches Rs3,967b in outgoing fiscal year

Top Story

July 1, 2020

ISLAMABAD: The Federal Board of Revenue (FBR) has achieved a little growth and fetched tax collection of Rs3,967 billion in outgoing fiscal year 2019-20 against its collection of Rs3,826 billion for corresponding year in 2018-19.

In last two consecutive years under the current government’s rule, the FBR’s data shows that the revenue collection increased just by Rs125 billion contrary to the claims of ruling party that the FBR revenue would be doubled by touching up to Rs8,000 billion in one year period. However, the revenue growth remained negative during the first year rule of the current government in 2018-19 when the FBR collected Rs3,826 billion against revenue collection of Rs3,842 billion in fiscal year 2017-18 under the previous regime.

The previous government had increased its collection from Rs1,946 billion to Rs3,842 billion in its five-year rule from 2013 to 2017-18. The FBR is yet to see how the government will manage to curtail the budget deficit at desired level of 7.1 percent of GDP for outgoing fiscal year which ended on June 30. Now two major factors are going to impact the budget deficit target —first ability of the government to restrict the expenditures and second how much the provinces generate revenue surplus against the desired target of Rs423 billion in outgoing financial year.

Under the IMF programme, the budget deficit, especially the primary deficit, is considered sacrosanct and the desired primary deficit target is envisaged at Rs669 billion for fiscal year 2019-20 that ended on June 30. The details of fiscal operation will be made available with time lag of three to four weeks period. The revival of IMF programme will largely depend upon ability of the government to restrict the budget deficit within the desired limits. Against originally envisaged target of Rs5,555 billion on eve of budget for 2019-20, the FBR collected Rs3,967 billion in whole financial year, indicating revenue shortfall of Rs1,588 billion. The revenue target was revised downward thrice as it was revised downward from Rs5,555 billion to Rs5,238 billion and then the target was envisaged at Rs4,803 billion and in post COVID-19 pandemic, the target was again slashed down to Rs3,908 billion.

In a statement on Tuesday, the FBR announced that its revenue collection stood at Rs3,967 billion against revised target of Rs3,908 billion so its collection was surpassed by Rs59 billion in outgoing fiscal year. The FBR’s collection in June 2020 touched Rs420 billion against the revised target of Rs398 billion.

“Our collection may go up further till finalisation of revenue figures,” the FBR Member Inland Revenue (IR) Policy and spokesman Dr Hamid Ateeq Sarwar said while talking to The News.

According to provisional revenue collection, the FBR has paid refunds of Rs127.8 billion in fiscal year 2019-20 compared to Rs69.003 billion. The FBR collected Rs1,484.368 billion in shape of income tax in outgoing fiscal year compared to Rs1,424.3 billion, registering an increase by 4.2 percent. The sales tax collection stood at Rs1,597.354 billion in fiscal year 2019-20 against collection of Rs1,461.738 billion, registering an increase by 9.3 percent.

The Federal Excise Duty (FED) collection stood at Rs255.687 billion in fiscal year 2019-20 against collection of Rs240 billion, witnessing 6 percent growth. The FBR’s customs collection stood at Rs618.78 billion in outgoing fiscal year 2019-20 against Rs679 billion, registering negative growth of 9 percent. The book adjustments fetched Rs19 billion, while the FBR paid Rs8 billion refunds on June 30 through FASTER software.