Tuesday , November 24 2020
Breaking News
Home / Op-Ed / Editorial / Time is running out
Time is running out

Time is running out

After passing first seven and a half month, the FBR has been left with no other option but to take corrective measures without wasting any time for making last ditch efforts for achieving highly challenging tax collection target of Rs 2475 billion on June 30, 2014.

Chairman FBR Tariq Bajwa has jolted the bureaucracy of tax collection machinery in recent weeks keeping in view performance of field formations in first six months of the current fiscal year with clear-cut intention to bridge the yawning gap on account of materializing the desired tax collection target.

The performance of FBR in first half of the ongoing fiscal year was dismally low, indicating that it was lagging behind in achieving its tax collection target.

Against the envisaged tax target of Rs 2,475 billion, the IMF’s fiscal department high-ups have projected that the FBR would be able to collect Rs 2345 billion in the current fiscal year, indicating that FBR collection will face a shortfall of Rs 130 billion against its actual target of Rs 2475. Although, the FBR has not revised downward its annual target from Rs 2475 billion to Rs 2345 billion so far.

But interestingly, FBR’s collection stood at Rs 1030 billion in first half of the current fiscal year, which was exactly in accordance with the IMF’s projection for first six months that also stipulates that FBR’s collection can approximately go up to Rs 2345 billion instead of Rs 2475 billion keeping in view track record of first six months.

With the reshuffle in the FBR especially in Large Taxpayer Units, Regional Taxpayer Units and Customs Collectorates, the tax machinery netted Rs 168 billion in January this year compared to a collection of Rs 132 billion in the same month of the last financial year, registering a growth by 26 percent.

In remaining five months (Feb-June) period of the current fiscal year, the FBR will have to collect Rs 1265 billion for achieving its desired tax collection target of Rs 2,475 billion on June 30.

In case of netting Rs 2345 billion, the FBR will have to collect Rs 1125 billion in Feb-June period of the ongoing financial year. Without taking corrective measures at this juncture, it will be a big achievement of the FBR even to touch Rs 2,345 billion on June 30 instead of eyeing a collection target of Rs 2475 billion.

The approach of right person for the right job can deliver goods in the FBR at this point of time. The Chairman FBR has made reshuffle in the FBR with the same intention especially in major revenue spinner business hub like Karachi, Islamabad and Lahore.

With induction of Rehmatullah Wazir as Chief Commissioner at LTU Karachi, it is expected that the FBR will be able to bridge the revenue gap in the second half of the current fiscal year.

By improving tax administration through ensuring effective enforcement on collecting withholding tax, creating demand and collection of taxes, recovery of arrears, resolution of lingering legal disputes involving billions of rupees, controlling smuggling and other pre-requisites are important for achieving the desired tax collection target of Rs 2475 billion for the current fiscal year.