FBR is expected to face a shortfall of Rs. 275 billion in the first quarter of the current fiscal year. A shortfall of Rs. 175 billion is expected this month alongside a proposal for a mini-budget of approximately Rs. 1 trillion.
To meet the tax target of Rs. 12.97 billion, the target for the current month is Rs. 1.1 billion. The upcoming mini-budget may eliminate sales tax exemptions and impose withholding tax, sources told ProPakistani.
A mini-budget could be introduced at any time after the end of the current month to cover the revenue shortfall. FBR will not be able to meet September’s target, let alone cover August’s shortfall. The bureau collected over Rs. 450 billion in September, according to sources.
By the end of September, FBR is expected to collect approximately Rs. 950 billion in taxes. The revenue shortfall for August and September combined may reach about Rs. 250 billion.
Internal assessments at FBR have raised concerns about potential revenue shortfalls each month. Due to monthly revenue shortfalls, the tax target may not be achieved by the end of the fiscal year.
The mini-budget is considering proposals to eliminate sales tax exemptions and increase withholding tax. There’s a proposal to impose a uniform sales tax rate by eliminating sales tax exemptions.
According to targets agreed with the IMF, there is no room for revenue shortfalls, sources say. Instead of expanding the tax net to increase tax collection, more burden will be placed on existing taxpayers.
