The Federal Board of Revenue (FBR) has informed the government that it may face a tax shortfall of approximately Rs400 billion by the end of December, despite the implementation of record taxes exceeding Rs1.5 trillion.
According to a news report, senior FBR officials briefed Finance Minister Muhammad Aurangzeb that the shortfall could increase by Rs50-60 billion in December alone, following a Rs341 billion shortfall from July to November.
The FBR is aiming to meet its monthly tax target of Rs1.373 trillion, but officials acknowledge the likelihood of a Rs60 billion shortfall in the coming month.
In the briefing, the FBR officials suggested reviewing high taxes on the real estate sector, which they say have slowed property sales and contributed to the shortfall. However, any reduction would likely require approval from the International Monetary Fund (IMF).
Despite extensive efforts, including hiring foreign-funded consultants and injecting more funds into the FBR, the government has been unable to meet the five-month target.
The FBR collected Rs4.295 trillion in taxes during the first five months, falling short of the target of Rs4.64 trillion. Although this represents a 23% increase over last year, the FBR needs a 40% growth to meet the annual target of nearly Rs13 trillion.
The tax body had projected a tax shortfall of Rs325-Rs350 billion for the first half of the fiscal year, but this estimate proved inaccurate by the fifth month.
The IMF is expected to assess Pakistan’s December tax collection before deciding whether a new, tax-heavy budget is required.
