ISLAMABAD: The Federal Board of Revenue (FBR) collected Rs1.840 trillion in the first four months of the current financial year exceeding the target of Rs1.608tr by Rs232 billion, provisional data compiled by the FBR showed on Saturday.

Compared with the revenue collection of Rs1.341tr in 2020, the collection posted 37 per cent growth in the first four months (July-October) this year.

The revenue collection in October 2021 rose by 33pc from last year’s Rs331bn. It stood at Rs439bn in October exceeding the target of Rs397bn by a margin of Rs42bn during the month under review. These figures would further improve before the close of day (Sunday) and after book adjustments have been taken into account.

Taking to the social media platform Twitter, Prime Minister Imran Khan appreciated the performance of the tax machinery in a tweet. “I want to congratulate FBR for achieving tax collection of Rs1,840bn for July/Oct, which is 37% higher than last year. Tax in October has surpassed its monthly target set. It is all due to a robust economic performance. Contrary to propaganda, Income Tax also grew by 32% YoY,” the premier tweeted.

Meanwhile, talking to Dawn, Adviser to Prime Minister on Finance and Revenue Shaukat Tarin said revenue collection was not imports driven. “Improvement in revenue collection from domestic taxes was noted in October as well,” he said.

Finance adviser says revenue collection not driven by imports

He linked the impressive performance in revenue with overall growth in the economy. He said the impact of track and trace system and broadening of tax base including documentation of retailers’ sales will yield further in the coming months.

The adviser was upbeat that the projected revenue target of Rs5.8tr will be achieved easily. The government, while preparing the budget for the current year, had assured the International Monetary Fund (IMF) of raising Rs5.829tr in FY22 against Rs4.721tr collected in FY21.

The finance adviser already held a meeting with the IMF in the middle of October in Washington as part of negotiations for the release of the sixth tranche under the $6bn Extended Fund Facility. The final report or outcome of the negotiations is expected next week.

The gross collections including refunds and rebates payments increased from Rs1.407tr during July-October 2020 to Rs1.931tr in the current financial year, showing an increase of 37pc.

The amount of refunds disbursed was Rs91bn during July-October 2021 compared to Rs66bn paid last year, reflecting an increase of 38pc. This is reflective of FBR’s resolve to fast-track refunds to prevent liquidity shortages in the industry.

With the rising import bill coupled with an increase in imports of smuggling-prone items on legal channels, Customs collection stood at Rs304bn during the first four months this year as against Rs207bn last year, indicating a hefty growth of 47pc. The target projected under Customs was Rs254bn for the period under review, which was surpassed by Rs50bn.

In October 2021, Customs collection stood at Rs75bn against Rs52bn over the last year, reflecting an increase of 45pc.

The Income Tax (IT) collection during the first four months stood at Rs626bn as against the target of Rs566bn, showing an increase of Rs60bn. Its collection showed growth of 32pc when compared with Rs475bn collected during the same period last year. In October, IT collection also surpassed the target of Rs137bn by three billion rupees to Rs140bn. It grew by 33pc when compared with last year’s collection of Rs108bn in October.

Meanwhile, Sales Tax (ST) collection jumped 40pc to Rs903bn from Rs644bn in the same period last year. The target was projected at Rs692bn and it was surpassed by Rs211bn. The growth came as a result of the highest ever rise in fuel prices, increase in imports and revival of economic activities during the period under review.

In October, ST collection posted growth of 35pc to Rs223bn against Rs165bn over the last year month. The ST collection target for October was projected at Rs168bn, which was surpassed by Rs55bn.

The FED collections were up 15pc to Rs97bn as against Rs81bn last year. The FED target for July-October 2021 was set at Rs95bn, which was surpassed by Rs2bn. In October, the FED collection stood at Rs26bn against Rs22bn last year, indicating a growth of 15pc. However, the FED October target was missed by Rs1bn.

Published in Dawn, October 31st, 2021