FBR to miss April revenue target by over PKR 100 billion

Pakistan’s Federal Board of Revenue (FBR) is expected to miss its revised monthly revenue target of PKR 963 billion for April by more than PKR 100 billion.

The FBR had collected only PKR 620 billion as of April 27, and sources estimate the final collection may reach around PKR 800 billion by the end of the month, marking the second consecutive month the revenue body will miss the revised downward International Monetary Fund-dictated monthly target.

Following the latest economic review last month, the IMF allowed Pakistan to revise downward its annual tax collection target — from PKR 12.9 trillion to PKR 12.3 trillion. Despite the revision, the FBR has struggled to meet its monthly goals.

The FBR chairman held virtual meetings on Saturday, during which he reportedly reprimanded senior tax officials over the anticipated revenue shortfall. He instructed teams to visit factories to boost collections in the final days of the month.

The FBR also faced a revenue shortfall of PKR 120 billion in March as the revenue body had collected PKR 1,100 billion against the target of PKR 1,220 billion.

The overall shortfall in revenue collection between July and April of the current fiscal year will reach over PKR 800 billion, reflecting a daunting task for FBR to meet the revised PKR 12,334 billion target for the current fiscal year. In the 10 months of the current fiscal year, the FBR has achieved its monthly target in only one month.

Sources said that the growth in tax revenue is expected to remain under pressure due to sluggish GDP growth and lower-than-expected inflation. The tax machinery has maintained a 26% growth in tax collection till the first nine months of current fiscal year.

Advance income tax remained the highest source of revenue in terms of withholding tax as FBR during the first eight months collected PKR 976 billion on account of advance income tax.