FBR misses August revenue collection target by Rs50bn – Newspaper

ISLAMABAD: The Federal Revenue Board (FBR) has breached the revenue collection target by a huge margin of Rs50 billion for August, second month of the new fiscal year, despite introducing several administrative and revenue measures in the last budget .

This deficit is additional to that recorded in the first month (Rs14bn in July) of the current fiscal year, bringing the total deficit in revenue collection to Rs64bn in just two months of the current fiscal year.

Against the target of Rs352bn projected for the month of August 2019, the FBR has managed to provisionally collect Rs302bn, which is well below the government's expectations in view of its claim to compile records.

Prime Minister Imran Khan withdrew the president of the FBR in May, as it became clear that revenue collection was heading towards a record deficit. To reach the ambitious income target of Rs5.55 trillion, on May 10, Khan appointed Shabbar Zaidi from the private sector as chairman of FBR to reverse the downward trends in revenue collection.

The total deficit reaches Rs64bn in two months of the current financial year

Customs collection did not reach the objective at Rs13bn, since the collection amounted to Rs52bn in August against the objective of Rs65bn. In the first month (July) of this fiscal year, the customs deficit was recorded at Rs9bn.

Compared to last year's figures, customs collections fell 1.88 percent, as it was Rs53bn in the last year.

The internal income tax (income tax, sales tax and federal special tax (EDF)) collected Rs250bn against the objective of Rs287bn, indicating a decrease of Rs37bn or 12.58pc below the objective.

While the collection of income tax increased to Rs92bn, it was still Rs18bn or 16.36pc below the target of Rs110bn projected for the month. Sales tax collection reached Rs141bn compared to the target of Rs158bn projected for the same month, indicating a decrease of Rs17bn or 10.75pc below the target.

Similarly, EDF collections recorded Rs17bn compared to the Rs19bn target, showing a decrease of Rs2bn or 10.5pc below the target.

However, there have been some improvements in the month of August of this year in the collection of internal income tax compared to last year's collection. It published a growth of 26pc with a revenue collection of Rs250bn in August against Rs198bn during the corresponding month last year.

A more detailed analysis shows that the Internal Revenue Tax, which was Rs110bn in August 2018, increased to Rs152bn in August 2019, showing an increase of 39pc. This growth is mainly achieved through a 39{7be40b84a6a43fc4fae13304fce9a2695859798abfc41afd127b9f8b21c5f9c5} increase in the collection of income tax, 43{7be40b84a6a43fc4fae13304fce9a2695859798abfc41afd127b9f8b21c5f9c5} in sales tax and 46{7be40b84a6a43fc4fae13304fce9a2695859798abfc41afd127b9f8b21c5f9c5} in the Fed. Contrary to this, the collection of Internal Revenue Tax through importation was recorded at Rs98bn in August compared to Rs88bn in the second month of last fiscal year, indicating a growth of 11pc. This was mainly achieved through a 17{7be40b84a6a43fc4fae13304fce9a2695859798abfc41afd127b9f8b21c5f9c5} growth in the sales tax, since the income tax in the import stage registered a negative growth of 16{7be40b84a6a43fc4fae13304fce9a2695859798abfc41afd127b9f8b21c5f9c5}.

Posted on Dawn, September 1, 2019

Source: https://www.dawn.com/news/1502853/fbr-misses-august-revenue-collection-target-by-rs50bn


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