FBR exceeds target, collects Rs489bn taxes in August

ISLAMABAD: The Federal Board of Revenue (FBR) has exceeded the August 2022 revenue collection target by fetching Rs489 billion against the fixed target of Rs483 billion, it said on Wednesday.

The FBR has collected Rs948 billion against the envisaged target of Rs926 billion in the first two months of the current fiscal year 2022-23 and the board had surpassed the assigned target by Rs22 billion.

The FBR will have to collect Rs661 billion during the ongoing month (September 2022) for materializing Rs1,609 billion collections for the first quarter (July-September) period of the current fiscal year in order to comply with the IMF conditions .

The FBR has envisaged an annual revenue collection target of Rs7,470 billion for the current fiscal year. Without achieving the desired target, the government will not be able to stick to the budget deficit target of 4.9 percent of GDP and get a primary surplus of Rs153 billion or 0.2 percent of the GDP in the current fiscal year.

“FBR has collected net revenue of Rs489 billion during August 2022, which has exceeded the target of Rs483 billion against Rs448 billion collected during the same period, last year,” the board said in a statement. “These figures would further improve after the book adjustments have been taken into account.”

The statement said collection figures are the highest ever in the month of August. “This outstanding revenue performance is a reflection of FBR’s resolve to build on its growth trajectory despite floods, zero rating on POL products, and import compression.”

On the other hand, the gross collection increased from Rs462 billion during August last year to Rs526 billion, showing an increase of 14 percent. Likewise, the amount of refunds disbursed during August was Rs37 billion compared to Rs14.3 billion paid last year, showing an increase of 161 percent.

The revenue increase in August is largely the outcome of various policy and revenue measures introduced by the government in Finance Act 2022. Unlike in the past, there is a visible focus on taxing the rich and affluent.

Owing to this paradigm shift, the growth in domestic income tax is almost 38 percent which is a remarkable shift towards direct taxation. Likewise, there is a significant upsurge in advance tax collected during August, which is 72 percent increase from the corresponding period of the previous year.

Provisional collection of Income Tax, Sales Tax, Federal Excise and Customs Duty were respectively Rs165 billion, Rs218 billion, Rs24 billion and Rs82 billion as against Rs124 billion, Rs223 billion, Rs23 billion and Rs77 billion during the corresponding period of the previous year. Total taxes collected during July and August stands at Rs948 billion against the target of Rs.926 billion.