Abdul Wajid Khan

The Federal Board of Revenue (FBR) has collected tax revenue of Rs1.635 trillion in the first quarter of the current financial year and exceeded the target of Rs1.609 trillion by Rs27 billion, reports WealthPK. According to the latest provisional data for September and the first quarter of the financial year 2022-23, the FBR has collected net revenue of Rs685 billion in September against the target of Rs684 billion, which is 27% higher than the collection of September last year.

Similarly, the target for the first quarter of the current financial year has also been surpassed by achieving Rs1.635 trillion collection against the target of Rs1.609 billion, and the growth is more than 17% for the quarter. The FBR said in a statement that the targets in revenue collection have been achieved despite zero rating of sales tax on petroleum products, import compression and the prevailing situation of floods. This impressive growth is primarily based on the 41% growth in direct taxes in the first quarter, which is in line with the policy of the government to tax the rich.

The revenue performance reflected the robust revenue mobilization strategy of the FBR and effective enforcement by the field formations. On the other hand, Rs84 billion of refunds were disbursed in the first quarter of FY23 against Rs62 billion in the first quarter of FY22, up by 35.5 %. The FBR expressed gratitude to all the taxpayers who have made possible this remarkable record collection during the first quarter of the current fiscal year.

Analysts said that the government should take more steps to provide ease to taxpayers in tax submission. While talking to WealthPK, economic expert Dr Nasir Iqbal said that the government should further streamline tax recovery mechanism of the FBR to improve its tax recovery, and strict action should be taken where tax recovery is low. He said the government should ensure maximum utilisation of modern technology to identify the potential taxpayers who are currently eligible for payment of tax but still out of tax net.

Dr Nasir Iqbal hoped that with the implementation of all necessary measures including the efficient utilization of technology and further streamlining tax recovery mechanism, the FBR would also be able to achieve its tax revenue target of around Rs7.4 trillion for the ongoing fiscal year. The Ministry of Finance in its latest economic outlook report said the net federal revenues in July FY23 increased by 9.3% to Rs229 billion against Rs209 billion in the same period last year.

The total expenditures increased by 3.7% to Rs536 billion in July FY23 compared to Rs517 billion in the same month last year. Within the total, the current expenditures increased by 8% to Rs531 billion in July FY23 compared to Rs492 billion in the same period of last year. Therefore, the fiscal deficit has been contained to 0.3% of gross domestic product (GDP) in July FY23 against 0.4% last year. The primary balance posted a surplus of Rs142 billion in July FY23 against the deficit of Rs5 billion last year.

To achieve the set targets, the budget FY23 is focused on stabilizing the economic growth, increasing revenue, enhancing exports, and protecting the vulnerable segments of society through relief measures and pro-poor initiatives.

Credit : Independent News Pakistan-WealthPk