Tax collection target set at Rs2.5 trillion for FY14

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ISLAMABAD: The new government has envisaged a tax collection target of Rs2,475 billion for the next budget against the revised estimates of Rs2,018 billion in the outgoing financial year, official sources said.

 

The PML-N government has also fixed an ambitious non-tax target of Rs800 to Rs850 billion in the upcoming budget and is expecting $1.4 billion reimbursement from the United States under the Coalition Support Fund (CSF), over $1 billion in fees through the auction of 3G (third generation) technology and some other sectors.

 

By increasing revenue mobilisation efforts and reducing non-development expenditures, the budget makers under the supervision of Finance Minister Ishaq Dar have been preparing projections on the basis of envisaging budget deficit at over six percent of GDP for the next financial year. “We are making fiscal adjustments close to two percent of GDP, which means that the revenue mobilisation and reduction in expenditures will be Rs500 billion in the upcoming budget,” the official sources said.

 

The federal government’s budget deficit might cross eight percent of GDP in the outgoing financial year so it will be a challenge for the PML-N government to bring it down by two percent to the level of six percent of GDP in the upcoming financial year.

 

“The PML-N government is considering fixing the Federal Board of Revenue’s (FBR) target up to Rs2,475 billion in 2013-14 against the revised estimates of Rs2,018 billion, envisaging an increase of 22.6 percent in the next financial year,” official sources in the FBR told The News. During the outgoing fiscal year, the tax target of the revenue body was thrice revised downward as initially the tax target was fixed at Rs2,381 billion, which was revised down to Rs2,193 billion and then slashed to Rs2,050 billion and finally lowered to Rs2,018 billion.

 

So far in the first 11 months (July-May) of the outgoing financial year, the FBR’s tax collection stands at Rs1,682 billion, registering an increase in the range of just five percent as compared to the same period last fiscal year.

 

Meanwhile, the FBR on Monday waived whole amount of default, surcharge and penalty on account of nonpayment of any outstanding duty and taxes.

 

According to the statutory regulatory order (SRO), the FBR has encouraged taxpayers to pay outstanding amount with an aim to maximise the tax collection target till June 30.

 

On the non-tax target, the government had envisaged the target of Rs730 billion in the outgoing fiscal year but it was revised downward to Rs690 billion in accordance with the revised estimates.

 

Despite getting increased inflows in the shape of reimbursement of the CSF up to $1.8 billion against the envisaged target of $1.5 billion, the government remained unable to auction 3G technology that resulted in downward revision in the nontax revenue target.

 

Now, the government is pitching nontax revenue target on the higher side with the expectation of more inflows from the United States under the CSF as earlier the ministry of finance was projecting inflows to the maximum of $400 million to $600 million but these projections were revised upward to maximise nontax collection target.




Courtesy:  The News


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