ISLAMABAD (June 12 2008): The federal government has fixed Rs 1.251 trillion revenue target for financial year 2008-09, which is Rs 35 billion higher as compared to the revised target of Rs 990 billion target of outgoing fiscal year. The Federal Board of Revenue (FBR) is expected to reach Rs 1 trillion mark by the end of current financial year.

Taxation measures on the sales tax and income tax side would enable the FBR to meet the target of Rs 1.251 trillion in the fiscal 2008-09. According to the break-up of target, direct taxes receipts have been projected at Rs 496 billion against revised target of Rs 388 billion, higher by Rs 108 billion for the on-going fiscal year. The original target of direct taxes was Rs 408 billion, which was brought down to Rs 388 billion during 2007-08.

The share of indirect taxes has been projected at Rs 755 billion that shows Rs 138 billion increase compared to the previous year's figures of Rs 617 billion. The original target of indirect taxes was Rs 622 billion during outgoing fiscal year, which was scaled down to Rs 617 billion.

The government has estimated income tax collection at Rs 477 billion during 2008-09 against the revised target of Rs 367 billion giving tax managers the task of generating Rs 110 billion to bridge the gap.

Further break-up shows that customs duty was projected at Rs 170 billion, as compared to Rs 148 billion revised estimates for the year 2007-08. On the basis of massive tariff rationalisation, the customs authorities have been assigned to generate Rs 22 billion more in upcoming fiscal year.

The sales tax target has been enhanced to Rs 472 billion from Rs 375 billion as per revised estimates of 2007-08. This indicates that the sales tax wing will have to collect Rs 97 billion more in the new fiscal year.

The share of the federal excise duty (FED) has been fixed at Rs 112 billion against the revised target of Rs 92 billion for the outgoing fiscal year. The board has to collect Rs 20 billion more in fiscal 2008-09 from excisable commodities/services.

Out of total direct taxes target of Rs 496 billion, the target of capital value tax (CVT) has been projected at Rs 6,500 million against last year's estimates of Rs 5,700 million. The CVT target showed a substantial increase of Rs 800 million from different areas liable to the levy.

The estimate of Worker's Welfare Tax (WWT) has been projected at Rs 3,500 million against last year's revised projection of Rs 2,400 million, depicting an increase of Rs 1,100 million. The target of Worker's Participation Tax (WPT) has been fixed at Rs 9,000 million as compared to the revised target of Rs 9,600 million.

Copyright Business Recorder, 2008