ISLAMABAD - The tax collection shortfall has reached Rs 72 billion during first half (July-December) of the ongoing financial year 2013-2014 despite the imposition of new taxes worth billions of rupees by the government.
“The Federal Board of Revenue (FBR) provisionally collected Rs 1018 billion during first six months (July-December) of the ongoing financial year 2013-2014, which is 17 percent higher than the collection of previous year”, said Shahid Hussain Asad, spokesperson of FBR while talking to The Nation on Tuesday. He further said that tax collection has stood at Rs 212 billion during the month of December. The tax collection would increase in next couple of days when final figures come, he added. However, sources informed that tax collection shortfall has reached to higher level of Rs 72 billion during six months, as revenue target for the said period was Rs 1090 billion. The huge revenue shortfall is making annual tax collection target difficult to achieve.
The government is struggling to achieve the tax collection of Rs 2475 billion during the current fiscal year. The revenue collection target requires a growth in tax collection of about 28% over the previous year. The government had introduced heavy taxation measures worth of Rs 207 billion in the annual budget 2013-2014 with an aim to reach the unrealistic target of Rs 2475 billion in the present financial year.
FBR sources termed the revenue collection target of Rs 2,475 billion for the current fiscal year 2013-14 as unrealistic and ambitious, as target has been based on the assumption that the FBR collection would be Rs 2007 billion, whereas the collection stood at Rs 1,939 billion. Thus the base has eroded by Rs 68 billion from the beginning of fiscal year (2013-14).
The International Monetary Fund (IMF) has shown concerns over the uphill revenue collection target of the government and projected that FBR would achieve only Rs2345 billion collection, which is Rs130 billion less than the official target.
However, independent economists are of the view that government’s policies are hurting the revenue collection target. The government has granted several tax concessions to the industrialists and traders, which is affecting the tax collection and leaving shortfall at higher side. Similarly, the government has announced a blanket amnesty programme for industrialists, giving them a chance to launder money that would also affect the revenue collection target.