Despite COVID pandemic FBR exceeds revenue target on back of economic uptick

The Federal Board of Revenue (FBR) has exceeded its revenue target for the first eight months of the current fiscal year.

As per the data released by the FBR, the tax collecting authority has collected net revenue of Rs.2916 billion during Jul-Feb period, which has exceeded the target of Rs.2898 billion. This represents a growth of about 6 percent over the collection of Rs.2750 billion during the same period last year.

The net collection for the month of February was Rs.343 billion against a required target of Rs.325 billion, representing an increase of 8pc over last February and 106pc of the target. When finalized after book adjustments, the collection figures are likely to improve further.

On the other hand, the gross collections increased from Rs.2823 billion during this period last year to Rs.3068 billion, showing an increase of nearly 9pc. The amount of refunds disbursed was Rs.152 billion compared to Rs.79 billion paid last year, showing an increase of 97 pc.

FBR was of the view that the improved revenue performance is a reflection of growing economic activities in the country despite facing the continued challenge of second wave of COVID-19. During March-June 2021, it is expected that this revenue performance would be improved substantially compared to 2020 when economic activities were disrupted.

Meanwhile, FBR’s efforts to broaden the tax base are expanding apace. Early signs suggest such efforts are bearing fruits. As on 28-2-2021, income tax returns for tax year 2020 have reached 2.62 million compared to 2.43 million last year, showing an increase of 8pc. The tax deposited with returns was Rs.49.6 billion compared to only Rs.31.0 billion, showing an increase of 60%. It may be recalled that last year the final date for submission to returns was 28th February. FBR’s decision to adhere to 8th December as the last date has been vindicated as more returns and higher tax payments have been recorded during the tax year 2020 compared to 2019.