FBR tax collection jumps to Rs593 billion for July, August
ISLAMABAD: The Federal Bureau of Revenue (FBR) collected Rs593 billion revenue against the assigned target of Rs551 billion, an addition of Rs39 billion in the first two months (July and August) of the incumbent financial year.
However, the Bureau failed to manage the assigned target of August 2020 as it only collected Rs293 billion against the fixed target of Rs308 billion. This was far less compared to the Rs243 billion collected in July 2020.
Independent tax experts say the FBR will have to collect Rs376 billion in September 2020 to achieve the desired tax collection target of Rs969 billion for the first quarter (July-Sept) period of the current fiscal year.
They believe if the FBR failed to surpass the desired target with a substantial margin in the first quarter, then the IMF will come up with the prescription of a mini-budget in the second half to materialise the desired target of Rs4,963 billion for the whole financial year.
According to details, against the assigned revenue target of Rs551 billion, the FBR collected Rs593 billion showing an increase of Rs42 billion and 108% of the assigned target. The revenue collection in the first two months of the previous year 2019-20 was Rs582 billion whereas it is increased to Rs593 billion this year.
To redress the hardships of the business community caused by the coronavirus, refunds to the tune of Rs30.6 billion have been disbursed collectively in the first two months of FY-2020 compared to the refunds of Rs11 billion during first two months of FY-2019.
Sales tax refunds were issued under a centralised and automated system called FASTER which is capable of clearing refunds to exporters within 72 hours for the first time.
The FBR said it has been proactively reaching out to traders and industrialists to resolve their issues. It has also launched an unprecedented crackdown on corruption, dismissing and suspending 76 officers and officials since July 2020.
In the post-COVID-19 pandemic scenario, economic activities are now being revived through multiple economic stimuli and reliefs granted in the budget FY-2020-21.
Efforts have been put in by the customs field formations in respect of collection of duty and taxes, which was otherwise a daunting task owing to the post-COVID-19 pandemic economic constraints, Muharram holidays and heavy rainfall in Karachi.
This torrential downpour badly affected the customs clearance of imported cargo during the last week of this month, also impacting the revenue collection. According to the official figure, total customs duty collected during the first two months of current FY-2020 stands at Rs92 billion. Sales tax collection at the import stage is on the lower side as compared to the corresponding period of the previous year owing again to heavy rainfall in Karachi.
Furthermore, exemption granted in respect of Additional Customs Duty (ACD) on more than 1,600 tariff lines in budget FY 2020-21, also subsequently resulted into a decrease in sales taxable value.
FBR launches countrywide anti-smuggling drive
In line with the vision and directives of the prime minister to curb smuggling, the Bureau vigorously launched a countrywide anti-smuggling drive. The FBR accordingly directed its field formations to make all-out efforts to intensify anti-smuggling activities.
In pursuance of the aforesaid directions, Pakistan Customs has initiated massive anti-smuggling operations throughout the country and across all terrains that have led to significant seizures of smuggled goods.
During the month of August 2020 alone, customs officials seized smuggled goods worth Rs3.95 billion compared to Rs2.1 billion in August 2019, thus showing an increase of 87.3%. These seized goods included fabrics, cigarettes, foreign currency, POL products, auto parts, foodstuff, narcotics and other miscellaneous goods. Moreover, mega seizures of luxury vehicles, gold, and betel nuts were also affected during the same period.
The customs formations at Quetta, Peshawar and Multan have seized smuggled goods worth Rs1.6 billion, while most of the remaining goods were at Karachi, Lahore and Islamabad.