The Federal Board of Revenue (FBR) suffered a shortfall of Rs. 98 billion in tax collection during the first two months of 2024-25, as net collection stood at Rs 1,456 billion against the assigned target of Rs. 1,554 billion during this period.
According to the data released by the FBR on Sunday, the FBR has collected gross revenues of Rs 1,588 billion for July and August 2024. Against a target of Rs 1,554 billion, the FBR has collected Rs 1,456 billion in net revenue, and refunds of Rs 132 billion (44% more than last year) were issued to exporters to resolve their liquidity problems.
The FBR collected Rs 593 billion under the head of domestic income tax compared to Rs 437 billion during July and August 2023, showing a growth of 36%. A healthy year-on-year growth of 40% was achieved in the domestic sales tax with a collection of almost Rs 314 billion.
Around Rs 86 billion were collected as Federal Excise Duty (FED), showing a year-on-year increase of 13%. As a result, a cumulative growth of almost 35% has been achieved in collecting domestic taxes.
The FBR has taken an 11 percent inflation figure for the two months of July-August 2024 against 28 percent inflation during July-August 2023.
The data revealed that the net income tax collection amounted to Rs 616 billion during July-August 2024 against Rs 489 billion collected during the same period of 2023.
The net sales tax collection stood at Rs 572 billion in July-August 2024 against Rs 473 billion collected during the corresponding period of 2023.
The net collection of customs duty totaled Rs 172 billion during July-August 2024 against Rs 166 billion collected during the corresponding period of last year.
However, on the import side, the same momentum could not be maintained due to continued compression in imports. In US$ terms, imports in the country have declined by 2.2% in August 2024 compared to August 2023. Similarly, the imports during August 2024 in Pak Rupees value also showed a decline of 7% compared to August last year.
Moreover, the import of high-duty items such as vehicles, home appliances, as well as miscellaneous consumer goods such as garments, fabrics, footwear, etc., have reduced significantly, changing the import mix.
This trend has impacted the collection of Customs duties as well as other taxes collected at the import stage. Despite a modest increase of 4% in the collection of Customs duties, FBR’s overall growth in net collection registered a 21% increase over the collection of the previous year.
