In a historic achievement, Pakistan’s Federal Board of Revenue (FBR) has surpassed the psychological target of Rs. 4 trillion in revenue collection for the fiscal year 2021.
The accomplishment, announced by Dr. Muhammad Ashfaq Ahmed in a report issued on Friday, marks the first time that the revised target has been exceeded by around 1 percent.
Dr. Ahmed acknowledged the unprecedented challenges posed by the global COVID-19 pandemic, noting that economies worldwide have grappled with disruptions and uncertainties. However, he highlighted Pakistan’s resilience in the face of adversity, emphasizing the country’s ability to contain the damages of the pandemic through appropriate and timely responses, setting the economy on a path of early recovery.
The economic turnaround, initiated in the first half of the fiscal year 2021, culminated in a remarkable 3.94% growth in the Gross Domestic Product (GDP) by the end of the financial year. This growth is a testament to the effectiveness of measures taken by the government to navigate the challenges brought about by the pandemic.
One of the standout achievements contributing to Pakistan’s economic resilience is the notable growth in FBR’s revenue collection during the fiscal year 2021. After experiencing relatively lean years in FY 2019 and FY 2020, with growth rates of -0.4% and 4.4% respectively, FBR’s revenue collection soared with an impressive 18.4% growth in FY 2021.
In absolute terms, the FBR collected Rs. 4,734.2 billion, surpassing the collection for FY 2020 by a substantial Rs. 736.8 billion. This achievement underscores the effectiveness of economic policies and revenue collection strategies implemented by the government.
Dr. Ahmed provided a breakdown of the growth in various tax categories, highlighting the robust performance across different sectors. Sales tax and customs recorded growth rates of 24.1% and 19.3% respectively, followed by direct taxes at 13.3% and Federal Excise Duty (FED) at 11.6%.
The report also acknowledged the adverse impact of the COVID-19 pandemic on national economies globally, affecting the revenue collection efforts of FBR as well. In response to the economic challenges posed by the pandemic, the annual revenue collection target for the fiscal year 2020-21 was revised downwards from Rs. 4,963 billion to Rs. 4,691 billion.
The surpassing of the revised target indicates a commendable effort by Pakistan’s tax authorities and underscores the country’s commitment to economic recovery and fiscal stability. As Pakistan navigates the ongoing challenges posed by the pandemic, this achievement serves as a positive beacon, showcasing the resilience and adaptability of the nation’s economy. The government’s adept handling of economic policies and revenue strategies bodes well for sustained growth in the post-pandemic era.
