The revenue collection registered a 14.6pc year-on-year growth in March due to an increase in the prices of petroleum products. It totalled Rs340bn last month against Rs297bn accumulated over the corresponding month of the previous year, according to provisional figures.
Nevertheless, the revenue collection missed the target by Rs10bn as it was forecast to be Rs350bn in March. The shortfall was mainly due to lower collection of income tax and customs duty during the month under evaluation.
From July-March, the Federal Board of Revenue (FBR) collected Rs2,258b against Rs2,093b a year ago, reflecting an increase of 7.88pc. For the fiscal year ending June 30, 2017, the government has set a revenue collection target of Rs3,620.8b. The FBR needs to collect revenue ofRs1,362.8b in the next three months.
Achieving this revenue target will be very difficult for the government in the last quarter of 2016-17, stated a tax official. In light of this, the government may have to revise the revenue target downward.
The FBR wholly blamed the Ministry of Finance for this shortfall in revenue, because they didn’t consider the implications of revenue measures in the budget while setting the tax collection target for 2016-17.
Special Assistant to Prime Minister, Haroon Akhtar Khan stated he had worked out the negative revenue impact of the decisions that the government took after setting the annual target.
Because of these decisions, he mentioned that the FBR registered a shortfall of Rs120b until February 23. The failure to increase fuel prices had also resulted in a shortfall of Rs90b while the effect of a downward revision in the duty on fertilisers was Rs 14b, he said. The financial kitty also lost Rs14 b due to the abolition of zero-rating on five sectors while lower rates on pesticides led to a loss of Rs2b.
The collection of sales tax reached Rs127b in March in comparison to Rs117b in the same month of 2016, highlighting an increase of 8.54pc. The amount of customs duty collection totalled Rs47b in March against Rs36b last year, registering a growth of 30.5pc. It missed the target by Rs1b last month.
A growth of 11pc was registered in the collection of federal excise duty in March which was Rs20b against Rs18b a year ago,. The target for the collection of excise duty was achieved last month.
