The collection of property taxes in Sindh and Khyber Pakhtunkhwa (KP) reportedly decreased during the second quarter of the current fiscal year against collection in Punjab and Balochistan, according to fiscal operation 2012-13.
Data for the fiscal operation for the second quarter of the current fiscal year, released by the Ministry Finance, showed that the collection of property tax in Khyber Pakhtunkhwa was recorded at Rs 100 million in July-September 2012, but it decreased to Rs 51 million for the July-December 2012 period. Similarly, the collection of property tax in Sindh stood at Rs 918 million during July-September 2012, but it dropped to Rs 905 for July-December 2012.
Tax experts said that it was surprising to note that property tax collection of the two provinces was higher in the first quarter, but it dropped in the second quarter of the current fiscal year. The total collection of the property taxes of the two provinces by the end of July-December 2012 was less than the first quarter (July-September) of the same fiscal.
Property taxes are not refundable. The collection of property taxes in Punjab increased to Rs 3.406 billion in July-December 2012 from Rs 2.406 billion during July-September 2012. The collection of property taxes in Balochistan increased to Rs 23 million in the second quarter of the current fiscal year, up from Rs 8 million in July-September 2012.
The consolidated budget deficit for July-December 2012 has been contained to 2.6 percent of the GDP against annual target of 4.7 percent of the GDP due to provincial surplus and CSF payment. The provinces generated a budget surplus of Rs 142 billion in the first half of the current fiscal year with Rs 66 billion by Punjab government, followed by Rs 45 billion by Sindh, Rs 11 billion Khyber Pakhtunkhwa and Rs 18 billion by the Balochistan government.
Additionally, non-tax revenue collection stood at Rs 449 billion during July-December 2012-13 against the total collection target of Rs 713 billion largely because of reimbursement of the Coalition Support Fund (CSF) by the US. All this helped the government to contain the consolidated fiscal deficit to 2.6 percent.
The government borrowed Rs 557.926 billion from banks, and Rs 66 billion from non-banking institutions to finance the fiscal deficit. The tax collection of federal and provincial governments stood at Rs 1.461 trillion against the total expenditure of Rs 2.086 trillion during July-December 2012. The Public Sector Development Programme (PSDP) expenditure was recorded at Rs 251billion during July-December 2012 with Rs 129 billion by the federal and Rs 122 billion by the provinces.