The sliding rupee value against US dollar would help increase inflow of remittances, discourage imports and boost exports. This was stated by Ministry of Finance sources here on Sunday. They said that sliding of the value of the rupee should not be taken negatively, as it would help increase the inflow of remittances.
They added that those who are remitting their amounts in dollar terms would get more amount in terms of local currency, and they would remit more money thus improving the inflow of foreign remittances.
They further said that sliding rupee value against the greenback would also help increase exports and would reduce imports and, therefore, it would help improve the trade balance. "Imports will become expensive and our exports in the international market will become cheaper. Therefore, this will not only improve the trade balance but will also reduce the current account deficit", they remarked.
Quoting economic data recorded for the first month of the current financial year, sources said that FBR collected Rs 71.5 billion during July of the current fiscal year as compared to Rs 50.9 billion in the same month of last financial year, posting healthy increase of 40.4 percent. This increase in tax collection was bolstered by strong growth in both direct and indirect taxes, they added.
Breakdown of the consolidated FBR collection for the month under review shows that direct taxes, which account for 25.8 percent of total tax collection of the FBR, have registered an impressive growth of 31.6 percent.
Rs 4.4 billion were collected in direct taxes which is more than the figures of July of last year, they added. Indirect taxes, on the other hand, exhibited stellar growth of 43.8 percent during the period under consideration.
The contribution of indirect taxes in total tax collection of the FBR has increased from 72.3 percent in July 2007 to 73.9 percent in July of this year.
Within indirect taxes, sales tax, which accounts for roughly 63 percent of indirect taxes and 46.8 percent of total taxes, grew by 28.0 percent (Rs 33.5 billion). Sales tax collected from domestic economic activity was up by 43.7 percent while sales tax collected at import stage grew by 16.7 percent.
The customs duty collection was up by 41.2 percent and the collection of federal excise duty has recorded a massive increase of 278.6 percent (collected Rs 7.0 billion) during the period under review.
The FBR collected Rs 1002.0 billion during the year 2007-08 and it has been targeted to collect Rs 1250 billion during the current fiscal year (2008-09), an increase of 24.8 percent, the statement added. Quoting State Bank of Pakistan, sources said that the inflow of workers'' remittances in 2007-08 breached the $6.0 billion mark for the first time, along with an increase of 17.4 percent over the corresponding period of 2006-07.
Building on the same positive trend, workers'' remittances amounted to $627.2 million in July, 2008, highest in a single month, showing an increase of 26.5 percent over last year''s July of $495.6 million.
The monthly average remittances during last fiscal remained $537.6 million, they added. Pakistan, they said, received $6.45 billion remittances in 2007-08. Target for the current fiscal year has been set at $7.5 billion, the statement said, adding that the increase of 26.5 percent in the first month of the current fiscal year suggests that the remittances target is most likely to be achieved, they added.
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