ISLAMABAD: The Federal Board of Revenue (FBR) faced a significant tax shortfall of Rs386 billion in the first half of the current fiscal year (July-December). The revenue collection stood at Rs5,623 billion, falling short of the desired target of Rs6,009 billion.
The IMF has given an indicative target of Rs6,009 bn till the end of December 2024 but the FBR managed net collection of Rs5,623 billion during the first six months of the current fiscal year (CFY). It is yet to be ascertained how much the FBR collected through advance collection because there were projections that it would face a shortfall of over Rs400 billion in the first half of the current fiscal year.
The FBR paid out refunds of Rs272 billion in the first six months of CFY. After striking a deal with banks, the FBR collected Rs72 billion during the current fiscal year after the promulgation of an ordinance for fixing the rate of 44 percent on their profits.
Top official sources said that the FBR fetched Rs275 billion on December 31, 2024, making increased collection possible. It collected Rs1,326 billion against the set target of Rs1,373 billion, witnessing a shortfall of Rs47 billion in December 2024. “The FBR has demonstrated its ability to collect more revenues and reduce its projected shortfall of Rs80-90 billion to just Rs47 billion in December,” said the sources.
The FBR has collected Rs2,826.5 billion as Income Tax, Sales Tax of Rs2,105.4 billion, Federal Excise Duty of Rs346.6 billion and Customs Duty of Rs617.2 billion in the first six months of the current fiscal. The gross collection stood at Rs5,895 billion. After paying Rs272 billion in refunds, the net collection stood at Rs5,623 billion.
One top official of the FBR contended that the net revenue collection improved till receiving the latest figures as the collection went up to Rs5,623 billion against the assigned target of Rs6,009 billion agreed with the IMF. It remains to be seen how the international lender would respond when its review mission visits Pakistan probably in the second week of February.
Pakistan and the IMF had agreed that if the revenue shortfall exceeds 2 percent against the assigned target, then contingency measures would be announced to bridge it. They may discuss reduction in the tax collection target as desired by Islamabad but the IMF may pursue additional taxation measures to achieve the desired tax collection target of Rs12,970 billion by June 30, 2025.
Adviser to the finance minister Khurram Schehezad said FBR tax collection for the month of Dec 24 clocked in at Rs1,328 billion, achieving 97pc of the monthly target. He added that collection for Dec 24 is also the highest in a single month.
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