Islamabad: Pakistan's Federal Bureau of Revenue (FBR) has been consistently falling short of its targets for the past 10 months, piling up a confounding shortfall of Rs 833 billion during the current fiscal year. This is happening at a time when the government led by Prime Minister Shehbaz Sharif has imposed a record number of additional taxes and is reducing refunds. Experts say the upcoming budget will also be very challenging with many towering targets to achieve.
As per details, the tax shortfall exceeded the limit set by the International Monetary Fund (IMF) by at least Rs 190 billion. The annual target or Rs 12.97 trillion set by the Pakistan government was revised by the IMF, after it acknowledged that it was not achievable.
However, the tax shortfall during the month of April added an additional Rs 139 billion in tax shortfall, contravening the guarantee to the IMF that the shortfall against the target will not exceed Rs 640 billion.
Statistics reveal that the FBR collection is Rs 9.3 trillion in taxes provisionally till the end of April, falling short by at least Rs 833 billion. While the tax collection was higher than the previous year by at least 27 per cent, it is still enough to stay on trajectory.
Financial experts say that the current fiscal year and the next one will be tough in terms of collecting taxes. The same was admitted by Chairman FBR before the National Assembly Standing Committee on Finance.
“There will be little space for giving any relief in taxes in the budget. But we are reducing taxes on the salaried class in the budget," stated the FBR Chairman.
Interestingly, the salaried class has been paying more taxes than the business community. By the end of March, the salaried class paid a record Rs 391 billion in taxes, at least 56 per cent more than the last year, and 1420 per cent higher than the traders.
The increased taxes have been protested by the business community, who have highlighted that the Pakistan government has even imposed taxes on milk products, despite the fact that Pakistan is a nutrition deficient nation.
“We demand intervention of the National Assembly Standing Committee on Finance, to reduce the 18 per cent sales tax on packaged milk, which has increased prices by Rs 70 per litre in the market,” demanded Pakistan Dairy Association (PDA).
(Except for the headline, this article has not been edited by FPJ's editorial team and is auto-generated from an agency feed.)
