The Federal Board of Revenue (FBR) has reported a remarkable surge in the annual collection of sales tax on imports, marking a growth of over 27% during the fiscal year 2020/2021.
According to official data provided to PkRevenue.com, the sales tax on imports reached Rs1.116 trillion, a substantial increase from the Rs876 billion recorded in the preceding fiscal year.
The FBR attributes the robust growth in sales tax on imports to factors such as the volume and composition of imports. The total collection for the fiscal year 2020-2021 amounted to Rs.1,115.9 billion, indicating a notable expansion of 27.3%.
Examining the details of the collection, it becomes evident that the sales tax on imports is concentrated in a few specific items. The data reveals that fifteen major commodity groups contributed approximately 82% of the total collection during the fiscal year 2020-2021.
Among these, petroleum products emerged as the leading source of revenue, constituting around 23% of the total sales tax on imports collection. The growth in this category was approximately 10.6% for the fiscal year 2020-2021, driven by a 17% increase in the imports of petroleum products.
Iron and steel also exhibited a noteworthy growth of 33.7% in the collection of sales tax on imports. This growth aligns with the 29.4% increase in imports within this category during the same fiscal year.
The automobile sector demonstrated a substantial surge of around 89.6% in sales tax on imports, primarily fueled by a robust growth of approximately 98% in the import of automobiles.
The remaining major contributors to revenue in this category showcased positive growth, attributed to improvements in their respective imports.
The FBR’s report underlines the significant impact of specific sectors, such as petroleum, iron and steel, and automobiles, on the overall collection of sales tax on imports. The concentration of revenue in these key areas reflects the influence of import patterns and economic dynamics.
As Pakistan navigates its economic landscape, the FBR’s data offers insights into the shifting dynamics of import-driven taxation. The substantial growth reported for the fiscal year 2020-2021 indicates the resilience and adaptability of the revenue system in response to evolving economic conditions.
