ISLAMABAD: The Federal Board of Revenue (FBR) has provisionally collected net revenue of Rs3,394 billion during July-March (2020-21) against the assigned target of Rs3,287 billion, reflecting an increase of over Rs100 billion.
The FBR, Wednesday, released the provisional revenue collection figures for the first nine months of the current fiscal year. Top FBR officials told Business Recorder on Wednesday that the historic growth in revenue collection is only due to the enforcement measures taken during current fiscal year. In the last budget, there were zero revenue measures and tax relief of Rs 25-30 billion was provided to the taxpayers including industry/trade. During the current fiscal year, the FBR has not taken any advances from the companies. The FBR has also cleared all current refunds of exporters. At the same time, the FBR has created a current tax demand of Rs 1.5 trillion during July-March (2020-21), which is the highest tax demand ever during the last five years. Out of 90 percent tax demand of Rs 1.5 trillion, 90 percent has been raised by four Large Taxpayer Offices (LTOs) against the big corporate entities and multinational companies. The impact of raising current tax demand of Rs 1.5 trillion during July-March (2020-21) would be visible in next fiscal years. The historic increase in revenue collection is only due to the execution of law and enforcement/administrative measures during 2020-21, they added.
According to the provisional information, the FBR has collected net revenue of Rs3,394 billion during Jul-March period, which has exceeded the target of Rs3,287 billion by more than Rs100 billion.
This represents a growth of about 10 percent over the collection of Rs3,076 billion during the same period last year.
The net collection for the month of March was Rs475 billion, against a required increase of Rs367 billion, representing an increase of 46 percent over Rs325 billion collected in March 2020 and 129 percent of the target.
The year-on-year growth of 46 percent is unprecedented.
These figures would further improve before the close of the day and after book adjustments have been taken into account.
On the other hand, the gross collections increased from Rs3,178 billion during this period last year to Rs3,571 billion this year, showing an increase of 13 percent.
The amount of refunds disbursed was Rs177 billion compared to Rs102 billion paid last year, showing an increase of 74 percent.
This is reflective of the FBR’s resolve to fast-track refunds to prevent liquidity shortages in the industry.
The improved revenue performance is a reflection of growing economic activities in the country, despite, facing the challenge of the “third wave” of the Covid-19.
During April-June 2021, it is expected that this revenue performance would be improved substantially compared to 2020, when economic activities were disrupted due to the Covid.
Meanwhile, the FBR’s efforts to broaden the tax base are expending apace.
Early signs suggest such efforts are bearing fruits.
As on 28-2-2021, income tax returns for tax year 2020 have reached 2.8 million compared to 2.6 million last year, showing an increase of eight percent.
The tax deposited with returns was Rs51 billion compared to only Rs33.0 billion, showing an increase of 54 percent.
It may be recalled that last year the final date for submission to returns was 28th February.
The 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.
Moreover, a number of 123,680 new Income Tax Returns have been received for Tax Year 2020 resulting into collection of additional tax of Rs511 million.
Sales tax returns for the period from July 2020 to February 2021 have reached 179,584, whereas, they were 167,769 in the corresponding months last year, showing an increase of 7.04 percent.
The sales tax paid with returns is 624 billion this year, which was 536 billion last year, showing an increase of 16.41 percent.
The FBR has also released the information about Tier-I retailers who have been integrated with POS system.
According to the information, 10,283 sales points have been integrated with Point of Sales Linked Invoicing System.
Pakistan Customs has initiated a focused counter-smuggling drive.
During March 2021, smuggled goods worth Rs3.634 billion have been seized while in March 2020; smuggled goods worth Rs2.74 billion were seized, thus, showing a monthly increase of 39 percent.
Similarly, during last nine months (July 2020-Mar 2021) of the current financial year, smuggled goods worth Rs45.98 billion have been seized as compared to Rs27.7 billion from July 2019 to March 2020 of the last financial year, thus, showing an increase of 66 percent.
Moreover, the value of seized goods of Rs46 billion in nine months of current FY has crossed the total value of seized goods of last year.
In FY 2019-20, smuggled goods worth Rs36 billion were seized.
Directorate General of Intelligence and Investigation-IR showed commendable performance during July to March 2021.
During this period, the Directorate General forwarded 846 investigation reports to the field formations involving revenue amounting to Rs147 billion.
Directorate General filed 136 complaints under Anti-Money Laundering Act, 2010 against 175 accused persons involving revenue of Rs50 billion during the period from October 2018 to March 2021.
Further, the Directorate General seized 5,057 cartons of illicit cigarettes containing 50,570,000 cigarette sticks during July to March 2021.
Copyright Business Recorder, 2021