ISLAMABAD: Federal Board of Revenue (FBR) needs to collect tax at a difficult growth rate of 45.5 percent in remaining half (January – June) of fiscal year 2020/2021 to achieve full year revenue collection target of Rs4,963 billion.
According to provision figures released by the FBR on Friday the net collection for the first half (July – December) of fiscal year was at Rs2,204 billion as compared with Rs2,101 billion in the same period of the last fiscal year, showing a growth of five percent.
The FBR also missed the revenue collection target for the first half by slight margin. The collection target for the first half of the current fiscal year was Rs2,210 billion.
Tax authorities hoped that the momentum of revenue collection would increase as major chunk of revenue was lost last year during the second half due to coronavirus pandemic.
According to a FBR report an amount of around Rs500 billion as revenue could not be realized due to halt in economic activities after coronavirus lockdown during March – June 2019/2020.
The FBR needs another Rs2,759 billion during the next half of the current fiscal year to achieve the target. It shows that average monthly collection should be around Rs460 billion during January – June 2020/2021.
The tax collection was at Rs2,101 billion during last six months of the preceding fiscal year.
Therefore, in case the FBR could able to realize Rs500 billion revenue losses incurred due to the pandemic in the last fiscal year the final tally would be in favor of the tax authorities.
The FBR has been assigned Rs4,963 billion revenue collection target for fiscal year which was 24.16 percent higher when compared with total collection of Rs3,997 billion in the last fiscal year.
Tax experts, however, doubt about the collection numbers by end of current fiscal year. They said that the coronavirus was not over and second phase of the pandemic had already denting economies of many countries.
The breakup of head-wise collection revealed the direct tax collection posted 4 percent growth to Rs816 billion during first half of the current fiscal year as compared with Rs785 billion in the same half of the last fiscal year.
The collection of sales tax registered 6.7 percent growth to Rs915 billion during July – December 2020 as compared with Rs857.6 billion in the corresponding half of the last fiscal year.
The collection of the federal excise duty stood at Rs127 billion during the half under review as compared with previous collection of Rs125 billion.
Likewise, the collection of customs duty posted 3.06 percent growth to Rs336 billion during the first half of the current fiscal year as compared with Rs326 billion in the corresponding half of the last fiscal year.
The FBR collected Rs508 billion during the month of December 2020 as compared with Rs469 billion in the same month of the last year.
The issuance of refunds increased by 90 percent to Rs102 billion during first half of the current fiscal year as compared with Rs53 billion in the corresponding half of the last fiscal year.
The FBR said that another refund amount of Rs42 billion was issued under Prime Minister Corona Relief Package.
