Over 62% of sales tax revenue collected from 15 sectors, reports FBR

Over 62% of Pakistan’s domestic sales tax revenue for 2023-24 came from 15 key sectors, with electricity, petroleum products, sugar, cement, cigarettes, and cotton yarn among the largest contributors. 

According to Federal Board of Revenue (FBR) data, electricity led the list, contributing 22.5% of the total domestic sales tax due to increased power tariffs.

Sales tax collection from electricity rose to Rs364.66 billion in 2023-24, up from Rs223.22 billion in the previous year, marking a 22.5% increase. 

However, revenue from petroleum products dropped, contributing only 9% to the total, down from 11.9% last year, with Rs145.35 billion collected compared to Rs151.86 billion in 2022-23.

The FBR recorded a significant increase in sales tax from other sectors, with sugar generating Rs98 billion, up 28.5% from Rs76 billion in the prior year. 

Cigarette sales tax revenue grew 64.3% to Rs60.66 billion, while the Federal Excise Duty (FED) on cigarettes rose by 66.9%, reaching Rs237.07 billion. The cement sector saw a 59.5% increase, with sales tax collections of Rs66.62 billion in 2023-24 compared to Rs41.76 billion the previous year.

Overall, the FBR reported a 56.1% increase in net FED collection, reaching Rs577.4 billion, up from Rs369.9 billion in 2022-23. 

FED’s share in total tax collection rose to 6.2% from 5.2%, with major contributions from cigarettes, cement, beverage concentrates, and air travel. Most major sectors recorded growth in FED revenue, except for concentrates and motor cars.