Sunday, August 14, 2022

FBR exceeds the May tax collection target by 8%

The Federal Revenue Service (FBR) exceeded its collection target by 7.82 percent to reach Rs 386 billion in May, the third highest collection in the current fiscal year (2021), showed provisional data collected by tax authorities on Monday.

Net revenue in May was Rs386 billion, against a target of Rs358 billion, an increase of Rs28 billion. Compared to the collection of Rs229 billion in May 2020, revenue collection grew by 69%.

May is the third consecutive month in which tax collection exceeded the target.

FBR collected net revenue of Rs4.167 trillion during the period from July 2020 to May 2021, which exceeded the target of Rs3.994 trillion by more than Rs173 billion or 4.33%. This represents an increase of about 17% over the collection of Rs3,549tr during the same period last year.

The government, while preparing the budget for FY21, had guaranteed the International Monetary Fund (IMF) an increase of Rs4.96 tr against Rs3.99 tr raised in FY20, a projected increase of 24.4%.

However, the IMF has revised this revenue target down to Rs4,691tr for the current fiscal year. The FBR will have to raise Rs523 billion in June to meet the target, which is achievable and likely to be exceeded.

For the coming year, the IMF has proposed a revenue collection target for the FBR of Rs5,963tr compared to the revised target of Rs4,691tr for FY21. However, Finance Minister Shaukat Tarin said that FBR’s revenue collection will reach Rs5.80tr in the financial year 2021-21.

Moreover, the Seizure of smuggled goods also increased revenue, and smuggled goods worth Rs 52.5 billion were seized compared to Rs 40.8 billion in the same period in FY20, showing an increase of 29%.

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