The Federal Board of Revenue (FBR), which outperformed expectations in the first five months of the current fiscal year, missed its collection target for December by nearly 24%, or Rs225 billion, as a result of a sharp decline in imports and a delay in collecting super tax.
Compared to the target of Rs965bn, the provisional revenue collection in December was Rs740bn. The enormous shortages in the second half of FY23 will make it difficult for FBR field formation to recoup because of this trend reversal.
However, compared to the Rs600.5 billion collected in December of last year, there was an increase of 23.23 percent. When book adjustments are completed in the upcoming days, a few more billion will be added to the government coffers.
The first half of the year’s income collection fell 218 billion rupees short of the planned amount of Rs3.646 trillion, or Rs3.428 trillion due to the decline in December.
In contrast to the Rs2.929tr collected in July through December of last year, the collection increased by 17pc in 1HFY23. This growth is far less than what the government promised to the IMF to meet the goal for FY23.
FBR officials according to local media reports claim that the failure to open letters of credit is what caused the large decline in imports during the first half of the year (LCs).
Due to the government’s import compression strategy, there was a significant decline in a few key revenue generators such as vehicles (CBU and CKD) and other machinery. Nearly 50% of the total revenue collected is contributed by the import stage collection.
