The Federal Board of Revenue (FBR) has achieved a notable milestone by collecting revenue amounting to Rs. 5,150 billion from July 2023 to January 2024. This marks a substantial growth of 30 percent compared to the collection of Rs. 3,973 billion during the same period in the last fiscal year.
Data released by the Ministry of Finance on Tuesday reveals that tax refunds witnessed an increase of over 28 percent during this timeframe. The overall growth in domestic taxes reached approximately 40 percent, while import duty and related taxes experienced a 16 percent increase. The surge in revenue is attributed to the revival of the GDP and intensified scrutiny of FBR collections.
The Ministry highlighted that the growth in import taxes was impacted by downward adjustments in import tariffs over the years and recent restrictions on import licenses imposed by the State Bank of Pakistan (SBP) to address balance of payments concerns amid foreign exchange constraints.
Despite a decline in growth in import taxes, revenue collection from imports considered the positive impact of improvements in import valuations, resulting in Rs. 151 billion in collections, and an ongoing anti-smuggling drive. The Ministry emphasized the potential to enhance anti-smuggling efforts by bolstering the customs force in Balochistan.
A noteworthy shift has occurred in revenue mobilization, with domestic tax collection now constituting over 64 percent of the total revenues during the current financial year. Concurrently, the share of import taxes has decreased to 36 percent, down from over 50 percent just three years ago.
Analyzing tax-wise collections, major contributors to income tax include banks, POL, textile, power, food, and service sectors during July-Jan 2023-24, compared to the same period in the last fiscal year. Sales tax contributions were led by POL, power, food, autos, Iron & Steel, and chemicals. Federal excise duty major contributors encompassed tobacco, cement, beverages, airlines, fertilizers, and autos. Customs duty was prominently contributed to by POL, autos, Iron & Steel, electronics, and food sectors, as per the data.
