FBR has collected only Rs130b so far in September against target of Rs282b. PHOTO: FILE
Tax revenues of the government have dropped sharply in September as taxmen have been able to collect only Rs130 billion so far, forcing Finance Minister Ishaq Dar to call an emergency meeting here on Friday to step up collections.
As only six working days are left, the Federal Board of Revenue (FBR) needs to collect another Rs152 billion, with an average of Rs25.3 billion a day, to achieve the monthly target. Businesses will be closed for four days next week on account of Eid holidays, which will also affect revenue collection.
The Rs281.7-billion target for September would be missed by a wide margin and it would be the third consecutive month when the goal would not be met, said sources in the FBR.
For the first quarter (July-September) of the current fiscal year, the FBR has set the target of Rs647.4-billion, which is Rs109 billion or one-fifth higher than previous year’s collection.
However, by September 18, the FBR could receive only Rs462 billion, suggesting it will fall short of the quarterly target by a wide margin and raising fears of imposition of more taxes and reduction in development spending like the previous fiscal year.
Read: FBR serves tax audit notices to three opposition senators
In the first two months (July-August), the revenue collection fell short of the target by Rs33 billion. The FBR needs a growth of 20% to achieve the annual target of Rs3.104 trillion, but so far the growth has been in single digit.
The PML-N government has already failed to collect required revenues in the first two years of its rule.
It has announced two mini-budgets in the first two months of the current fiscal year and increased taxes on petroleum products to unprecedented levels to shore up its revenues. However, the politically unpopular measures have not helped in achieving the desired results.
The falling revenues forced the finance minister to hold a meeting with tax authorities, which was also attended by Special Assistant to Prime Minister on Revenue, Haroon Akhtar Khan.
Dar reviewed the goals and strategy for revenue collection in the meeting, according to a press release issued by the Ministry of Finance. Khan assured Dar that the FBR was making sincere efforts to reach the revenue collection goal.
No final decision could be taken and the finance minister called another meeting on Saturday. According to the officials, a plan of action to prop up falling revenues will be finalised on the return to office of FBR Chairman Tariq Bajwa, who is on leave until the end of this month.
Technical hitches in the FBR’s information technology system also came under discussion.
The minister took notice of the difficulties faced by regular as well as prospective taxpayers in filing e-returns and other information technology-related matters, said the finance ministry.
He stressed that he had been stressing simplification of the procedure for filing tax returns and it should be carried out swiftly.
Dar directed the FBR acting chairman to ensure that all IT-related issues were resolved on priority to facilitate the taxpayers in filing returns and undertaking other transactions.
Read: Absence of political will behind low tax revenue
Tax refunds
The FBR has also been accused of blocking tax refunds to inflate its revenues. In a meeting of the Senate Standing Committee on Finance on Friday, the senators asked tax officials about the tax refund figures.
The FBR claimed that the total outstanding amount was Rs148 billion including Rs88.5 billion in income tax refunds. Earlier reports, however, suggested that the refunds were in the range of Rs220 billion to Rs250 billion.
Published in The Express Tribune, September 19th, 2015.
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