ISLAMABAD: In line with the IMF agreement, the Federal Board of Revenue (FBR) has revised its annual tax collection target downward from Rs12,970 billion to Rs12,913 billion for the current fiscal year 2024-25.
Top official sources confirmed to The News on Thursday that the IMF and FBR had agreed upon monthly and quarterly targets for materialising the desired tax collection target of Rs12,913 billion from July 2024 to June 2025. “The FBR has envisaged tax collection target of Rs2,642 billion for the first quarter (July-September) period of the current fiscal year under which the July 2024 target was fixed at Rs656 billion, Rs898 billion for August 2024 and Rs1,098 billion for September 2024,” official sources confirmed.
The IMF was convinced because the expenditures were rationalised. Then the FBR’s target was slashed but the overall fiscal deficit and primary surplus remained unchanged for the current fiscal year.
The FBR’s collection stood at Rs9,311 billion for the last fiscal year, ending on June 30, 2024. There are some alleged instances where the FBR secured advance taxes for ballooning its collection last June 2024. Even the revised tax collection target of Rs9,252 billion was exceeded and the collection stood at Rs9,311 billion. Now the IMF has made crystal clear that if the agreed quarterly target was not materialised, then the contingency plan was to be put in place to take additional revenue measures during the current fiscal year. In the aftermath of the approval of budget for 2024-25, the FBR unveiled Tajir Dost Special Procedure, 2024 for slapping fixed tax rates ranging from Rs100 to Rs60,000 per month depending on the valuation of shops located in respective areas of 42 cities across the country.
There are selected places of less than 100 where the FBR imposed a fixed tax of Rs60,000 per month. There are a total of 25,989 entries in different markets of 42 cities. Almost 145 entries are where the tax rate of Rs45,000 is imposed. Almost 75 per cent entries are where the FBR has imposed fixed tax of Rs100 per month. The FBR has informed the IMF that it is expecting to collect Rs50 billion from the retailers during the current fiscal year. It has finalised a media campaign to convince traders on online integration for the Tajir Dost Scheme going to be launched within the next few days.
On the issue of dispatching tax notices to almost 5 million potential tax-dodgers being identified by the Mckinsey consulting firm through the withholding data, the FBR high-ups say that they had already sent tax notices to those who had stopped filing their tax returns. There might be duplication in sending notices to the same non-filers who have already been served notices by the FBR in the past few months.
This scribe sent out questions to both the IMF and FBR but did not get response till the filing of the report.
