Daily Times

ISLAMABAD: There is good news for FBR: the tax collection target has been exceeded. The Federal Board of Revenue (FBR) released the provisional revenue collection figures of Rs458 billion for July 2022.

The FBR, according to the data, has collected net revenue of Rs458 billion during the period, which has exceeded the target of Rs443 billion by Rs15 billion.

These collections are the highest ever in the month of July, the FBR said, which represents a growth of about 10% over the collection of Rs417 billion during the same period, last year.

The figures are expected to improve after book adjustments have been taken into account.

On the other hand, the gross collection increased from Rs438 billion during July last year to Rs486 billion, showing an increase of 11%. Likewise, the number of refunds disbursed during July was Rs28 billion compared to Rs21 billion paid last year, showing an increase of 32%.

Owing to the paradigm shift, the domestic taxes contributed 55% to the collection, while import taxes remained 45%.

This has reversed the trend. Previously, the taxes at the import stage were 52-53% of the overall collection. Likewise, the growth in domestic Income Tax is almost 31%, which is a “remarkable shift towards direct taxation”, the FBR said.

Good news for FBR: tax collection target exceeded

Likewise, there is a significant upsurge in the Advance Tax collected during July. There is also a 118% increase in the Advance Tax on the sale of properties u/s 236-C due to enabling of a withholding provision applicable irrespective of the holding period. Likewise, a 40% increase in Advance Tax u/s 147, especially from the banking companies is due to a change in the tax rate.

Similarly, an increase in the rate of FED on cigarettes/tobacco has paid its dividends. The FED from tobacco has registered a record growth of over 47% or Rs2.6 billion and the corresponding increase in Sales Tax from the Tobacco Sector has registered a record 67% growth.

The increased FED on international air travel has also registered a growth of over 200%. Furthermore, Pakistan Customs has collected Rs67 billion under the head of customs duty during July 2022 against Rs65 billion collected during the same period last year, registering a marginal growth of 2.58%.

However, it suffered a dip against the target fixed for July of Rs77 billion, which is due to the import compression policy of the government, aiming to control the outflow of US dollars.

Furthermore, the FBR suffered a loss of about Rs11 billion in Sales Tax against zero-rating of the petroleum products.

It is pertinent to mention that Income Tax Returns for Tax Year-2021 have reached 3.4 million compared to 3.0 million in Tax Year-2020, showing an increase of 13%.

The tax deposited with returns during the Tax Year 2021 was Rs76 billion compared to only Rs52 billion in the Tax Year 2020, showing a significant increase of 46%.