Services, electricity: Negative growth in ST collection witnessed

RECORDER REPORT

ISLAMABAD: The Federal Board of Revenue (FBR) has witnessed negative growth in sales tax collection from services and electricity during July-March (2011-12), says FBR's quarterly review issued here on Saturday.

The commodity-wise details of domestic sales tax collection during July-March 2011-12 confirms that a significant growth has been witnessed in sugar (130.3 percent) followed by cement (82.2 percent), natural gas (19.5 percent) and petroleum (POL) products by 11 percent. The collection of sales tax is skewed towards few items and only major 10 items shared 73 percent in gross collection. A negative growth has been recorded in general sales tax (GST) receipts from services and electricity during the period under review. The negative growth in services is mainly due to collection of services started by the Government of Sindh as well. As far as decline in the collection of electrical energy is concerned, higher refunds payments as well as higher input/output ratios as compared to previous year have affected its collection during July-March, 2011-12.

The contribution of sales tax at import stage has been around 53 percent in total sales tax collection during July-March 2011-12. The growth in each quarter and overall collection has been encouraging. In first quarter, second quarter and the third quarter, ST collection at import stage grew by 62.8 percent, 37.6 percent and 50.7 percent respectively. The commodity-wise details reveal that top 10 major commodities have recorded a double-digit growth in collection. These items include POL products, edible oil, plastic, vehicles, machinery, fertilizers, iron and steel etc. Further, around 35 percent of ST collection originates from POL products, FBR added.