Revenue collection may fall short of target

The Central Board of Revenue (CBR) is not likely to meet the enhanced target of Rs 590 billion set for current fiscal, as the expected collection till late Thursday night might reach Rs 580 billion despite all out efforts of the tax machinery.
Official sources told Business Recorder that the CBR would manage to collect around Rs 580 billion after all coordination with the collectors of sales tax, central excise and regional commissioners of income tax (RCITs).
The authorised branches of State Bank of Pakistan (SBP) and National Bank of Pakistan (NBP) remained open till 10.00 pm on Thursday where people were busy in depositing taxes in the national kitty. Even the cigarette industry deposited an amount of Rs 21 billion against the target of Rs 19.75 billion set for the current fiscal.
However, the officials made it clear that if the CBR reaches Rs 580 billion on July 1 (Friday), even then there would only be an increase of Rs 4-Rs 5 billion in the provisional figures of Rs 580 billion. This would ultimately take the total final collection to around Rs 584-585 billion. But the enhanced target of Rs 590 billion would still remain a long way to go.
The officials said that reaching the figure of Rs 590 billion would not be an easy task because the CBR has paid huge amount of refunds to the tune of Rs 100 billion in July-June 2004-05 and did not withhold sales tax refunds of exporters. On the other hand, the CBR is near Rs 580 billion, achieving this original target set for the tax authorities. The collection of additional Rs 10 billion will be an uphill task due to the reasons that the collection from all major sources has been generated and refunds were timely paid to the business community.
In the past, refunds were withheld to show more revenue collection, but this is for the first time that the CBR is about to reach Rs 580 billion despite payment of huge amount of sales tax refunds to the exporters. The officials pointed out that the CBR also did not force the businessmen to deposit advance tax collections just to meet the target.
They added that the CBR did not collect any substantial amount from two amnesty schemes, including waiver of additional tax and penalty on payment of principal amount of sales tax and secondly, remission of penal surcharge on clearance of goods from the bonded warehouses. The response of business community to both these schemes was not very encouraging.