KP government might fail to achieve revenue collection target of FY 2016-17

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Pakistan Tehreek-i-Insaf (PTI) led provincial government of Khyber Pakhtunkhwa (KP) is far behind in achieving revenue collection target set in the budget for the on -going Financial Year (FY), 2016-17, it was learnt from sources.

Documents available with Pakistan Today disclosed that KP government has so far achieved only 37 per cent of the full year target of revenue collection under the heads of provincial own tax and non-tax revenue, which would cause reduction in the spending on the much needed development projects in the province that is severely inflicted with poverty and backwardness.

According to the available details, the KP government has collected only Rs18.3 billion in the first nine months of the current fiscal year against the full year target of Rs49.5 billion. At the time of budget, KP government’s target for provincial own tax and non-tax revenue receipts was set at Rs 49.507 billion for the year 2016-17. Under this target, provincial own tax revenue target was Rs 18.171 billion while provincial own non-tax revenue target was Rs 31.335 billion.

However against these targets, the KP government could only collect Rs12.102 billion in own tax revenue while Rs6.229 billion in non-tax revenue. The total provincial tax and non-tax revenue collection thus stand at Rs 18.3 billion which is only 37 per cent of the full year target, according to the data released by the federal government on 5th May, 2017.

According to Khyber Pakhtunkhwa’s provincial government fiscal operations, from July to March 2016-17, the total revenue was Rs263,146m and provincial share in federal revenue was Rs224,261m while provincial taxes were recorded at Rs 12,102m. Similarly, Sales Tax on Services GST recorded Rs7,793m, provincial non tax collection recorded Rs 29,183m, total expenditure was Rs290,235m, current expenditures remained at Rs216,429m, other current expenditure were at Rs215,966m, while development expenditure (PSDP) was Rs73,806m, and overall balance was at Rs27,089m from July to March 2016-17.

It is pertinent to mention here that the so far failure of KP government in achieving revenue collection targets set in the budget of FY 2016-17 was due to many reasons. It is said that recent change of provincial finance secretary due to chief minister’s annoyance has also affected the fiscal operations of KP government. Former KP secretary finance Ali Reza Bhutta who earned CM’s crticism was removed on last Thursday. Although Jamaat-i-Islami, which holds the finance portfolio in the Pakistan Tehreek-i-Insaf-led provincial government, it had reportedly reasoned for Mr Bhutta’s removal but tried to convince CM Pervez Khattak to retain his services till the announcement of next provincial budget, however, the Jamaat-i-Islami has ostensibly failed to convince the chief minister to change his mind again.