Rs7.64tr collection target: FBR needs a miracle to collect Rs1.4tr in last month of FY23

ISLAMABAD: The Federal Board of Revenue (FBR) could collect Rs572 billion taxes in May and faces a gigantic task to fetch Rs1,446 billion in the last month (June) of current fiscal for meeting its tax collection target of Rs7.64 trillion.The upward revised tax collection target of Rs7.640 trillion seems impossible to materialise for the ongoing financial year ending on June 30 keeping in view the FBR performance in April and May.The revenue collector requires Rs906 billion in June 2023 in order to touch even the mark of Rs7 trillion against the agreed target of Rs7.640 trillion with the International Monetary Fund (IMF).

With such FBR performance, while expenditures are continuing unbridled, the yawning budget deficit might escalate further in the outgoing financial year, so the gap between the total revenues and expenditures is bound to further widen against the fixed target of restricting it in the range of six percent of the GDP. It is yet to see how the government is going to solace the IMF on the revival of the stalled loan programme because in the prevailing circumstances, the Fund likely gives set prescription i.e. either take additional tax revenues or slash down the expenditures.

In the aftermath of slapping additional taxes of Rs170 billion through a mini-budget under the IMF prescriptions including hiking the GST rate from 17 to 18 percent and slapping 25 percent GST on certain luxury items, the government miserably failed to yield the desired results for materialising revenues after February 14, 2023 mini-budget.

Although the FBR did not release any official figures on Wednesday night, the sources disclosed that the revenue collector would be heading towards a massive shortfall for achieving the envisaged tax collection target of Rs7.64 trillion on June 30. The FBR has so far collected Rs6.194 trillion in the first eleven months (July-May) of the current fiscal year.