Islamabad: Due to unrealistic targets, Pakistan failed to meet the IMF’s basic condition of collecting Rs 60 trillion in revenue, with total collections in the first half falling short of the target by Rs 386 billion.
During this period, the government also failed to achieve the IMF’s target of collecting Rs 23.4 billion under the Trader-Friendly Scheme.
The trend in tax collection shows that instead of accepting the demand for a mini-budget, the government is talking to the IMF to reduce the target.
According to statistics, the FBR collected Rs 56.23 trillion in taxes till December, as against the Rs 60.09 trillion target for the first half of the year. During this period, the shortfall in collections was Rs 386 billion, however, this shortfall is less than the initial estimates.
During this period, the increase in collections was 26 percent instead of 40 percent, thus the FBR collected Rs 1.16 trillion more than the previous fiscal year, which is a good development for an economy with a growth rate of less than one percent in the first quarter and an inflation rate of 8 percent.
However, the authorities are facing severe pressure due to government measures regarding taxation and an annual target of around Rs 1.3 trillion based on incorrect assumptions.
According to the report, despite the shortfall, refunds of Rs 275 billion were paid in the first quarter of this year, while refunds of Rs 234 billion were given in the same period of the previous fiscal year.
According to the report, the IMF had decided to ask Pakistan for a mini budget after reviewing the collections of the first half of the year. In the view of the IMF, there are serious problems in achieving the targets of indirect revenues, namely sales tax, federal excise duty and customs duty.
According to the report, under pressure from the IMF, the government imposed a general sales tax on basic consumer goods, including stationery, bakery items and medical tests, which resulted in a collection of Rs1.9 trillion in sales tax, which is 25 percent more than the same period last year but Rs179 billion less than the target. Similarly, despite doubling the federal excise duty on cement and lubricant oil, the FBR collected Rs107 billion less than the target, and customs duty also collected Rs156 billion less than the target.
