The Federal Board of Revenue (FBR) has fell short by Rs91 billion pp in meeting its tax collection target for the first quarter (July-September), collecting Rs2,563 billion instead of the projected amount.
According to a news report, the revenue assumptions included Rs1,190 billion expected from increased tax rates, Rs320 billion from enforcement measures—including Rs50 billion from the retailers’ scheme—and Rs2,047 billion anticipated from revenues tied to Sindh, imports, and Large-Scale Manufacturing (LSM) growth.
Despite surpassing the income tax target of Rs1,098 billion by collecting Rs1,230 billion in the first quarter—partially due to a rise in tax return filers—the shortfall remains significant, particularly in sales tax collected on imports, which fell Rs147 billion short of expectations.
Notably, the number of NIL/Null filers still stands high at 2.9 million, impacting overall collection figures.
The FBR collected Rs9.299 trillion last fiscal year and set a target of Rs12,913 billion for the current fiscal year.
The key economic assumptions used to project revenue targets changed significantly. CPI-based inflation was initially targeted at 12.9%, but it fell to 9.2% in the first quarter and dropped further to 6.7% in September.
Import growth was projected at 16.9% but declined to 8%, while LSM growth, initially set at 3.5%, stood at just 1.3%. Real GDP growth, expected to be 3.5% at budget time, has been revised down to 3% for the fiscal year.
As per the report, given these economic adjustments, FBR expects a cumulative shortfall of around Rs321 billion for the first half (July-December) of the fiscal year, with an additional Rs100-200 billion shortfall in non-tax revenue.
This combined fiscal gap could result in a total deficit of Rs500-600 billion for the first half of the year, presenting a considerable challenge for fiscal management.
