Finance minister calls for realising true tax potential
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Finance Minister Ishaq Dar has stressed the need for stepping up efforts to realise the “true tax potential” existed in the country and lent full support to the revenue collecting authority in performing its duties.
The minister put emphasis on increasing tax receipts at a meeting he chaired to discuss revenue collecting performance of the Federal Board of Revenue (FBR) on Tuesday.
Special Assistant to Prime Minister (SAPM) on Finance Tariq Bajwa, SAPM on Revenue Tariq Mehmood Pasha, FBR Chairman Asim Ahmad, senior officers of the Finance Division and FBR attended the meeting.
FBR chairman gave a presentation on revenue targets and performance of the FBR for the period July 2022 to March 2023. He expressed the strong resolve to make all-out efforts to meet the remaining revenue targets in the last quarter of fiscal year 2022-23.
According to a news story in The Express Tribune, the FBR suffered a tax shortfall of Rs276 billion in first nine months (July-March) of current fiscal year. The shortfall widened sharply in March despite the announcement of a mini-budget, which may compel the International Monetary Fund (IMF) to demand either a further reduction in expenses or imposition of more taxes.
According to FBR officials, against the target of Rs5.433 trillion, the bureau provisionally collected nearly Rs5.16 trillion during July-March FY23. Tax receipts fell short of the target by Rs276 billion despite the introduction of a mini-budget by the government in mid-February. In the mini-budget, the standard general sales tax (GST) rate was increased to 18% apart from jacking up the rate to 25% on dozens of goods.
As opposed to the monthly target of Rs727 billion, the FBR collected a mere Rs663 billion in March, sustaining a shortfall of Rs64 billion.
Almost all field formations of the bureau lagged behind in achieving their respective targets, with the monthly growth in tax collection coming in at just 16% in March.
(with additional input from our correspondent)
Published in The Express Tribune, April 26th, 2023.
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