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Low tax revenue cuts provinces share
 
 
 
Low tax revenue cuts provinces share

LAHORE- Following the downward revision in FBR tax collection from budgeted Rs2,475 billion to revised target of Rs2,275, the provinces share under the NFC Award through divisible pool has been declined by about 10 per cent, as the centre will release around Rs1280 billion to the provinces in the current fiscal year of 2013-14.
They said that Punjab received Rs294.69 billion, Balochistan Rs61.63 billion, Sindh Rs139.84 billion and KP Rs93.27 billion from provincial share in the divisible pool taxes for July-December, 2013.
The FBR has estimated a revenue shortfall of Rs200 billion in the last quarter of  April-June, compelling the centre disburse almost 10 per cent less share of federal divisible pool of taxes from the budgeted amount of Rs1,380 billion in the current fiscal year.
The finance ministry officials said that under the NFC Award provinces get 57.5 percent of the revenue collected by the FBR through the divisible pool comprising direct taxes, sales tax, customs duty, export duties and federal excise duty.
The government had set an ambitious tax target of Rs2,475 billion on the eve of budget for this ongoing fiscal year but the IMF had projected it to the tune of Rs2,345 billion from its initial assessment. Now the revised tax target of Rs2,345 billion seems in doldrums as the Board will have to collect over Rs603 billion in the last two months of the current financial year. It might cause hike in budget deficit or the government will have to cut down its expenditures to achieve the desired budget deficit target of 5.8 percent of GDP on June 30. On the basis of revised target of Rs 2,345 billion, the downward revised revenue collection target for last quarter of April-June 2013-14 was Rs775 billion. The revised revenue collection target for April 2014 was Rs196 billion, May 2014 Rs220 billion and for June 2014 at Rs360 billion. However, the set targets have been further scaled down following second downward revision in revenue collection targets from Rs2,345 billion to Rs2,275 billion.
In March, the FBR collected over Rs209 billion against the target of Rs215 billion, reflecting a shortfall of Rs6 billion. In April, the tax machinery collected Rs167 billion against the target of Rs199 billion in the corresponding period of April 2013, reflecting a shortfall of Rs32 billion.

 
 
on epaper page 8
 
 
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