FBR Kicks off FY23 By Exceeding Tax Collection Target
The tax regulator has released the provisional revenue collection figures for the month of July 2022. FBR has collected net revenue of Rs. 458 billion during July 2022, which has exceeded the target. This represents a growth of about 10 percent over the collection of Rs 417 billion during the same period, last year.
The amount of refunds disbursed during July was Rs. 28 billion compared to Rs. 21 billion paid last year, showing an increase of 32 percent. This is reflective of the FBR’s strong commitment to fast-track refunds and thereby prevent liquidity shortages in the industry.
Domestic taxes contributed 55 percent to the collection while import taxes remained 45 percent. This has reversed the trend of taxes at the import stage which used to account for 52-53 percent of the overall collection. The significant revenue increase in July is largely the outcome of various policy and revenue measures.
Growth in domestic Income Tax is almost 31 percent which is a remarkable shift towards direct taxation. There is also a 118 percent increase in Advance Tax on the sale of properties u/s 236-C due to enabling of a withholding provision applicable irrespective of the holding period.
An increase in the rate of Federal Excise Duty (FED) on cigarettes/tobacco has paid its dividends. The FED from tobacco has registered a record growth of over 47 percent or Rs. 2.6 billion. Increase in Sales Tax from Tobacco Sector has also registered a growth of 67 percent.
Pakistan Customs has collected Rs. 67 billion under the head of Customs Duty during July 2022 against Rs. 65 billion collected during the same period last year. However, it suffered a dip against the target fixed for July of Rs. 77 billion due to import compression policy of the government.
The tax deposited with returns during Tax Year 2021 was Rs. 76 billion compared to only Rs. 52 billion in Tax Year 2020, showing a significant increase of 46 percent. Around 23,265 point of sale terminals have been integrated with the real-time POS reporting system of FBR.