- FBR bureaucrats say concessions granted to agriculture and textile sectors in this FY’s budget are the main reason tax revenue has declined
Finance Minister Ishaq Dar is at odds with the Federal Board of Revenue (FBR). The tax collecting agency has lost steam in achieving its ambitious tax collection target of 3.6 trillion for current fiscal year, an official source said.
FBR has managed collection of Rs 1.08 trillion against a target of 1.2 trillion for July-November period, showing a loss of Rs 117 billion in the first four months of the current fiscal year. This makes achieving Rs 1.8 trillion in the first half of the current fiscal year impossible.
Finance Minister Ishaq Dar on Sunday chaired an important meeting in which tax affairs were discussed; sources said the tax mandarins held concessions granted to the agriculture and textile sector in the current financial year’s federal budget to be the main reason tax revenue had declined.
They said the reduction in GST on urea was the main reason of slow revenue collection under this head. They also pointed out that the petroleum prices have been maintained during the first five months which have also resulted in decline in urea.
Dar was informed by the bureaucrats that there were no lapses on the operational side. The tax revenues have been slow as the economy did not show any robust growth despite decline in interest rate and increase in energy supplies, they said.
The government has imposed taxes on non-filer traders and real estate sector. This has significantly slowed down activity in the housing and construction sectors. It has affected more than 40 industrial sectors which contribute a lot to tax returns.
An official statement said, the finance minister chaired the meeting to review revenue collection targets and other matters related to FBR. Special Assistant to PM on Revenue, Haroon Akhtar Khan, was also present during the meeting.
Chairman FBR Nisar, Mohammad Khan, briefed the finance minister on the latest revenue collection figures. The minister appreciated the efforts of FBR in increasing tax collections by 60 percent over the last three years. He urged the FBR team to redouble their efforts to meet this year’s revenue targets. He emphasized the importance of enhanced revenue collection given the background of country’s need for development and for achieving higher rate of inclusive and sustainable growth. The meeting was attended by senior officials of FBR and the Ministry of Finance.