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Tax collection target

Tax collection target

The year book 2013-14 issued by the Federal Bureau of Revenue (FBR) shows four percent growth in development and tax collection, but recorded a shortfall of Rs 209 billion in its revenue target set for the specified year. The FBR had collected Rs 2,266 billion during the previous year against a target of Rs 2,475 billion, falling short of Rs 209 billion. However, the board collected 16 percent more tax revenue than the previous fiscal year while it collected Rs 884 billion in the terms of direct taxes. According to a news report issued by Customs Today, increase in value of rupee has pushed net collection of customs duty up by around one percent in fiscal year 2013-14. The FBR report also shows that the customs duty has contributed around 17.4 percent and 10.6 percent in the indirect taxes and federal taxes, respectively during 2013-14.
The base of the customs duty is dutiable imports, which count for nearly 38 percent of the total imports during the year and any fluctuation in the tax base affects the collection of customs duty. Though duty free imports have grown by 5.9 percent, the dutiable imports show a growth of 7.6 percent, paving the way for the gross collection of Rs 249.7 billion from customs duties. However, the net collections remained Rs 241 billion as Rs 8.7 billion had been paid back as refunds/rebates during the year. The net collection of customs duty has recorded nearly 1 percent growth.
According to experts, there is a need to give relief on petroleum, machinery and edible oil to encourage private sector to meet its energy and technological requirements and concessions in edible oil will benefit the poor segments of society. The vehicles, which are used for goods transportation and white collar classes, also deserve duty relief. However, the fact remains that the more relaxation to the business community to generate more revenue. In the current scenario, petrol and oil are major revenue generation sources for the government and it is necessary to revise this policy by resorting to other options of revenue collection.