Govt may exclude Rs72bn from FBR collection target

RECORDER REPORT

ISLAMABAD: The federal government may exclude Rs 72 billion from the Federal Board of Revenue collection target of Rs 2,381 billion for 2012-2013 in case the Ministry of Finance agrees with the tax authorities to exclude sales tax projections of Sindh Revenue Board (SRB) and Punjab Revenue Authority (PRA) from FBR’s target for 2012-13.

Sources told Business Recorder here on Saturday that such a decision would bring down the FBR’s target from Rs 2,381 billion to Rs 2,309 billion for 2012-13. The SRB has projected Rs 32 billion sales tax target from services for 2012-13 whereas the PRA has set sales tax target of Rs 40 billion for 2012-2013. The total sales tax projections of SRB and the PRA come to around Rs 72 billion for the current fiscal. The revenue collection target of the FBR could be revised downward from Rs 2,381 billion to Rs 2,309 billion for 2012-13, depending on the decision of the policymakers regarding SRB/PRA tax projections.

The FBR wanted to exclude sales tax projections of SRB and PRA for 2012-13 from the overall revenue collection target of the FBR set at Rs 2,381 billion for 2012-13. If the sales tax projections of Rs 72 billion set for SRB/PRA are excluded from the FBR’s target of Rs 2,381 billion, the downward revised tax projection would come to Rs 2,309 billion for 2012-13.

“The matter is being discussed with the Ministry of Finance and principally we should not include the sales tax collection from services sector of Sindh and Punjab,” sources said.

The senior officials of both the Finance Ministry as well as FBR will work out the modalities taking into account the fact that the SRB and PRA will collect sales tax through own efforts and its collection should not be made part of the FBR’s collection for 2012-13.