ISLAMABAD: Amid uncertainty about FBR Chairman Shabbar Zaidi’s leave on health grounds, Federal Board of Revenue (FBR) has been facing mammoth revenue shortfall of Rs218 billion for achieving its revised target of Rs2,622 billion for the first seven months (July-Jan) period of the current fiscal year.
After witnessing such massive revenue shortfall, the IMF’s review mission is scheduled to kickstart second review talks under $6 billion Extended Fund Facility (EFF) coming Monday and all indications suggest that it would not be so much smooth review in the wake of slippages on the revenue front and other related issues.
Alone in January 2020, the FBR could so far fetch Rs321 billion revenues in accordance with provisional collection figures against the desired target of Rs425 billion, indicating that the shortfall of just one month stood at Rs104 billion. In the first six months (July-Dec) period the FBR had collected Rs2,083 billion against the downward revised target of Rs2,197 billion.
Meanwhile, the FBR has also extended the deadline for filing of income tax returns up to Feb 28, 2020. Its fourth extension in the date of filing of income tax returns during the current fiscal year.
With the consent of IMF, the government had already slashed the annual tax collection target from Rs5.5 trillion to Rs5,238 trillion. Now the IMF team might recommend the government to slap more taxes in the mini budget or cut down
expenditure in order to keep the budget deficit especially primary deficit within the envisaged limits. FBR Chairman Shabbar Zaidi would not be able to attend the upcoming review talks with the IMF’s visiting mission. So the government will have to give acting charge to anyone within the FBR fold till the decision of appointing new chairman if Shabbar Zaidi prefers to quit on the health grounds.
On the FBR’s front, the Inland Revenues (IR) including the Income Tax, Sales Tax and Federal Excise Duty (FED) collected Rs270 billion in January 2020 while Customs collection stood at Rs51 billion.
The FBR has provisionally collected Rs2,404 billion during first seven months of (2019-20) against Rs1794.9 billion during the corresponding period of 2018-19, reflecting an increase of Rs609 billion. The direct tax collection stood at Rs661.6 billion in the first half, showing a negative growth of 0.3 percent over the same time last year, showed the official statistics.
The sales tax collection that stood at Rs686.5 billion in December 2019 has increased by only Rs1.5 billion during the July-December 2018 period. The share of the sales tax collection in total revenues came down from 39.8 percent to 38.4 percent in the first half.
The federal excise duty collection amounted to Rs102.1 billion in the first half – up by Rs12 billion or 13.4 percent. The customs duties collection also registered a 19.4 percent growth and its collection increased to Rs336 billion in the first half of this fiscal year. The share of customs duties in total taxes increased from 16.3 percent to 18.8 percent in this fiscal year.
