FBR short of Rs8 bn to meet November target

ISLAMABAD: The Federal Board of Revenue (FBR) faces a shortfall of Rs8 billion, as it has collected Rs340 billion against the assigned target of Rs348 billion for November 2020. However, the collection has slightly surpassed its five-month (July-Nov) target during the current fiscal year (2020-21), standing at Rs1,677 billion against the set target of Rs1,670 billion.

“Yes, we have surpassed the five-month tax collection target,” said a top official of the FBR when this reporter sought his comments Monday night.

The FBR did not release its official statement on monthly provisional revenue collection till the filing of this report in the evening.

With the current pace, it seems the FBR will be able to touch Rs2,000 billion mark by end of December or by the first half of the current fiscal year.

The board will have to collect Rs3,000 billion in the second half (Jan-June) of the current fiscal year. On average, it would be required to collect Rs500 billion on a monthly basis. Usually, the FBR fixed higher targets for the last quarter (April-June) in every fiscal year.

The IMF has so far estimated that the FBR requires additional revenue measures of Rs250 to Rs300 billion for achieving the desired annual tax collection target of Rs4,963 billion.

The revival of the IMF program will depend upon the government's ability to come up with additional revenue measures through a new money bill or presidential ordinance in the coming months.

The Board's provisional revenue collection stood at Rs1,337 billion during the first four months (July-October 2020-21) against the assigned target of Rs1,322 billion. In November 2020, the FBR fetched Rs340 billion so the overall collection went up to Rs1677 billion for five months.

However, it’s consistently the third month when the FBR could not achieve its monthly target so it’s becoming challenging for the tax machinery to materialize its annual target of Rs4,963 billion.

The FBR collected Rs333 billion in October 2020 against the monthly target of Rs352 billion, reflecting a shortfall of Rs19 billion.

In the first four months, the collection of sales tax, federal excise duty, and customs duty remained at Rs643 billion, Rs81 billion, and Rs206 billion respectively.

The FBR collected gross revenue of Rs1,400 billion in the first four months from July to October, which was Rs1,323 billion in the previous year thus showing an increase of Rs77 billion in the current year.

During October 2020, the total collected revenue stood at Rs333 billion, which was Rs325 billion in the same month last year.

In the first four months of the current fiscal year, refunds to the tune of Rs128 billion against only Rs52 billion last year have been issued, which has greatly helped boost the economic activity.

The refunds issued during October this year are over Rs15 billion, which were Rs4.5 billion in the corresponding month last year.