Business

After refunds: FBR’s collection figures inflated by Rs16 billion

Net revenue collection reported at Rs583.8b, 8.5% higher than last year

Our Correspondent October 10, 2015

Net revenue collection reported at Rs583.8b, 8.5% higher than last year. CREATIVE COMMONS

ISLAMABAD: The Federal Board of Revenue (FBR) has over reported its revenue collection for the first quarter of the fiscal year by Rs16 billion, apparently in a bid to hide its inefficiency, raising concerns about the authenticity of official figures.

In an official handout issued on October 1, the tax authorities had claimed that the net revenue collection after paying refunds stood at Rs600 billion from July through September of this fiscal year, which was 11% higher than the collection in the comparative period.

However, data compiled by Directorate of Research and Statistics of the FBR tells a different story.

Net revenue collection was Rs583.8 billion from July through September this year, according to FBR documents. Hence, it was only 8.5% higher than the Rs537.9 billion collected in the comparative period.

The FBR’s revenue collection figures have often been disputed and it often claims higher collection by borrowing money and taking advance income tax.

For the first quarter, the FBR had set Rs647.3 billion tax collection target that was missed by a margin of Rs63.5 billion. The International Monetary Fund had also set an indicative revenue collection target of Rs640 billion for the first quarter, which has been missed by Rs56.2 billion. This will have a direct bearing on the current fiscal year’s annual revenue collection target of Rs3.104 trillion.

Due to the poor performance, the government will have to seek a waiver from the IMF during the upcoming talks, said an official of the Ministry of Finance. He said the shortfall in revenues weaken the government’s bargaining position, as the IMF may ask to levy additional taxes.

Pakistan has already given a written assurance to the IMF that it stands ready to take corrective measures, in case revenue collection falls short of the target. The growing shortfall in tax revenues is likely to result in missing the overall budget deficit target of 4.3% of Gross Domestic Product or Rs1.292 trillion for the current fiscal year.

In its recent report released this week, the IMF has already expressed its doubts about Pakistan’s ability to deliver on Rs1.292 trillion budget deficit target. It has stated that the target may be missed by a margin of 0.3% of the GDP or Rs90 billion.

Harald Finger, IMF Mission Chief to Pakistan, has already stated that the Fund will take up the issue of gap in budget deficit target during the upcoming review talks, scheduled for October 26 to November 6.

Published in The Express Tribune, October 11^th, 2015.

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COMMENTS (6)

zarshan tariq | 8 years ago | Reply The best performing ministry between 2005 and 2015 is the Ministry of Finance. They have borrowed loans through IMF standby arrangements, Kerry Luger Bill without even knowing the impact of those billions. An estimated over 15 Billion US dollars have been taken in different forms in this period. The outcome of the loans were to adhere to the policies developed by the international partners..... on their behalf which is not a true representation of the masses. Pakistan is sadly managed by these international agents or call them partners for now. They have truly hijacked the already borrowed economic system and "A New Greece" is in the making, BISP catering for 5.7 million families means a population of 35 Million would be affected if their is no money to pay to them and to be realistic how long can it last. No Power sector reforms in the horizon and Circular debt will keep on re-emerging till the cost of production is managed to an acceptable limit. Upto 80% of the population and Industry will be affected. Due IMF tranches are paid through receipts from new tranches and this is a very viscous circle.Ministry of Finance people are the same no matter who comes into power. The Secretary Finance is been the Secretary since the advent of IMF in Pakistan. My wild guess is that all people around him are the same bagging their big pockets with loads and loads of un accounted public funds. And to make it even worsening their is no Audit of any funds. Let me put like this.The Auditor General Pakistan, Accountant General Pakistan Revenue and Controller General Accounts are all at the disposal of the Finance Ministry. They all are summoned when needed and they are overgrown monsters with no teeth. They are devised so that they cannot work on their own.

Sandip | 8 years ago | Reply @Karachiite: That's because the dictator indulged in massive fudging of data, just as the rest of the Pakistani governments. In fact, when it comes to any department of the Pakistan government, it is impossible to believe even a single word of what they say. Lies and deceit have become staple fares across the board.