ISLAMABAD: Pakistan may not be able to achieve its tax collection target of Rs7,470 billion for the current fiscal year (FY23) as the country faces massive devastation caused by flash floods nationwide.
According to sources in the Federal Board of Revenue (FBR), stable growth, policy, and tax reforms are pertinent to achieve the target which do not seem possible in the current scenario.Â
In this regard, the Finance Ministry has revised the growth rate at 3.3 per cent from 5 per cent following the floods. According to a Finance Ministry document, economic growth could fall below 2.3 per cent in FY23 as floods have caused a loss of over Rs2,000 billion, including damage to lives, infrastructure, crops and livestock in the affected areas.
According to sources in the Finance Ministry, the slow down will vastly affect large scale manufacturing (LSM) and per capita income. They added that a new strategy will have to be developed to move forward.
Similarly, growth in key crops may fall to 0.7 per cent from an expected target of 3.9 per cent, growth in the industrial sector may drop to 1.9 per cent from an expected 5.9 per cent while growth in the services sector could decline to 3.5 per cent from an estimated 5.1 per cent in the ongoing fiscal year.
The report added inflation is likely to remain between 25 to 27 per cent. It highlights that the economy, which is already facing issues regarding balance of payment and debts, will be hurt further from floods and it could result in a further hike in inflation.Â
Assistance from friendly countries, and global development partners would be required to give help the economy, the report concluded.
