34% reduction in income tax returns filing

ISLAMABAD: Amid poor performance in increasing the tax base, due to a 34% reduction in income tax returns filing, the Federal Board of Revenue (FBR) has managed to achieve its four-month target of Rs2.14 trillion but may face difficulties in keeping the momentum from now onwards.
The poor performance in expanding the tax base compelled Finance Minister Ishaq Dar, for the second time, to further extend the date of filing returns by another month. The new date is now November 30 – a period during which FBR is required to get Rs1.3 million more in returns just to hit the previous years number.
According to FBR officials, against the July-October target of Rs2.143 trillion, the FBR collected Rs2.148 trillion in taxes. Compared to the same period of the last fiscal year, tax collection stood higher by 16%, or Rs305 billion, a pace that was lower than the prevailing inflation rate of 23%. But sufficient enough to keep the tax department on track for the first four months of the fiscal year.
During the first four months of the previous fiscal year, the FBR had collected Rs1.84 trillion in taxes. However, due to the slowdown of the economy, it seems that the FBR may miss its coming months’ tax targets.
The FBR could not achieve its monthly tax target of Rs534 billion, which it missed by Rs22 billion primarily because of a contraction in imports. The monthly target was missed despite achieving a 15% growth rate over Rs445 billion collection last October.-PNP