FBR eyes new taxation steps with a view to achieving Rs7,255bn target

ISLAMABAD: The Federal Board of Revenue (FBR) will propose new taxation measures of over Rs 300-350 billion to achieve the Rs 7,255 billion revenue collection target for the next fiscal year that was identified in the International Monetary Fund’s sixth review documents.

An official of Ministry of Finance confirmed to Business Recorder that the FBR tax collection target for next fiscal year would be Rs 7,255 billion, 18.9 percent higher than the Rs 6100 billion upward revised target for the outgoing fiscal year.

Sources informed that the target for next year appears to be realistic as it is premised on inflation and GDP growth projections for the next fiscal.

The IMF projected 7.9 percent inflation and 5.4 percent GDP growth for next fiscal year by mid to end January 2022 when the macroeconomic fundamentals were markedly different.

Sectors earning ‘windfall’ profits: FBR envisages ‘targeted’ taxation

When asked finance ministry officials did not appear as optimistic about inflation containment at around 8 percent given the sharp increase in commodity prices in the international market or GDP growth at 5.4 percent given the possibility of implementing contraction-based policies if the IMF’s seventh review is successful.

The FBR collected Rs. 4,858 billion net revenue during the first ten months of the ongoing fiscal year (July-April 2021-22) exceeding the target by Rs. 239 billion with 28.6 percent growth over Rs. 3,778 billion collected in the comparable period of the year before.

To achieve the target in the remaining two months of the current fiscal year, the FBR is required to collect Rs 484.5 billion per month to achieve the budgeted target of Rs.5829 billion and Rs 621 billion each month to achieve the upward revised target of Rs. 6100 billion.

Copyright Business Recorder, 2022