The government has decided to set a huge target for the Federal Board of Revenue (FBR) in next year’s federal budget. The government is also likely to withdraw tax exemptions from various sectors on the demand by the International Monetary Fund (IMF).
Sources told ProPakitani that the revenue collection target of Rs. 7.2 trillion for 2022-23 is not yet finalized, but the initial estimates revealed that the next fiscal year’s target could be nearly Rs 7.2 trillion. The proposed taxation measures, withdrawal of exemptions, and enforcement measures would finalize the next fiscal year’s target for the tax machinery. It also depends on the final figures of revenue collection for the whole fiscal year of 2021-22.
The breakup of the revenue collection target (2022-23) revealed that the direct taxes estimates may be projected at Rs. 2,711 billion; Federal Excise Duty has been estimated at Rs. 406 billion; the sales tax target has been projected at Rs. 3,295 billion and the next fiscal projection of customs duty may be fixed at Rs. 843 billion.
An FBR official said that the revenue impact of the new taxation/relief measures has not been finalized for the next fiscal year. However, the situation will be clear in the next 2-3 weeks.
The FBR is required to collect Rs. 621 billion per month in May and June 2022 to meet the upward revised target of Rs 6.1 trillion by the end of the current fiscal year.
The FBR has said that even though FBR had agreed to a target of Rs. 6100 billion with the IMF, the same was never made a target of FBR. So now FBR would need Rs. 484.5 billion per month to achieve the initial target of Rs. 5829 billion and Rs. 621 billion each in May & June to achieve the revised target of Rs. 6100 billion. The present government is fully determined to collect Rs. 6100 billion in this fiscal year, FBR added.
According to the provisional information, FBR has collected net revenue of Rs. 4,858 billion during July, 2021-April, 2022 of the current Financial Year 2021-22, which has exceeded the target by Rs. 239 billion. This represents a growth of about 28.6% over the collection of Rs. 3,778 billion during the same period, last year.
The FBR has provisionally collected Rs. 4,858 billion from July-April (2021-2022) against the assigned target of Rs. 4,619 billion, reflecting an increase of Rs. 239 billion.
The net collection for the month of April 2022 realized Rs. 480 billion representing an increase of 24.9 % over Rs. 384 billion collected in April 2021. On the other hand, the gross collections increased from Rs. 3,981 billion during July, 2020-April, 2021 to Rs 5,122 billion in the current Financial Year July 2021- April 2022, showing an increase of 28.7%.
Likewise, the number of refunds disbursed during April 2022 was Rs. 34.6 billion while in April, 2021 the refunds disbursed were Rs. 19.6 Billion, registering an increase of 76.2%. Similarly, refunds worth Rs. 264 billion have been disbursed from July 2021- April 2022 compared to R.s 203 billion paid last year, showing an increase of 30.1%.