FBR records 16% jump in January tax collection, misses target by Rs16 billion

The Federal Board of Revenue (FBR) has collected Rs1.031 trillion in January, marking a 16 percent increase compared to Rs873 billion in the same month last year. While the figure fell short of the Rs1.047 trillion target by Rs16 billion, the growth has renewed optimism for achieving double-digit revenue gains in the coming months. 

The FBR highlighted strong performance in income tax, modest gains in indirect taxes, and overall improved compliance across the board, reflecting the impact of its reform-driven revenue mobilisation strategy. January income tax receipts rose 26 percent year-on-year, while sales tax collections increased 12 percent, supported by a rebound in large-scale manufacturing (LSM). Federal Excise Duty (FED) collections exceeded expectations at Rs465 billion, up 15 percent from Rs404 billion last year. Customs duties stood at Rs752 billion, growing 6 percent year-on-year.

Despite the monthly gains, FBR’s cumulative collection from July to January (7MFY26) reached Rs7.176 trillion, falling short of the Rs7.521 trillion target by nearly Rs345 billion. The shortfall has been largely attributed to a dip in domestic sales tax, suspension of the super tax, and other factors. A recent Federal Constitutional Court ruling upholding the super tax is expected to generate Rs300 billion, potentially narrowing the seven-month gap.

FBR officials noted that reforms in digital infrastructure, enforcement, and dispute resolution have strengthened direct taxation, enhanced voluntary compliance, and expanded the tax base. With continued recovery in LSM, the authority remains confident that FY26 targets can still be met.

The board’s performance shows a positive trajectory, outpacing the average 10–11 percent growth observed over the last six months and suggesting that reform measures are beginning to yield tangible results for Pakistan’s fiscal outlook.