Disruption in economic activities: FBR so far faces over Rs300bn shortfall in November

ISLAMABAD: Owing to the lockdown and halting of economic activities for five days throughout the country, the FBR may face a massive revenue shortfall in achieving the assigned target, as the total collection so far stands at around Rs700 billion against the set target of Rs1,003 billion for November 2024.

If the FBR would face a shortfall of Rs160 billion, then the overall shortfall for five months would go up to Rs349 billion, keeping in view the shortfall of Rs189 billion occurring in the first four-month (July-Oct) period of the current fiscal year. It is yet to be seen how the government is going to satisfy the IMF keeping in view the widening shortfall in achieving the desired tax collection target for the current fiscal year. The persistent political instability is causing heavy losses to the national exchequer and the FBR high-ups are simply clueless how to maximise the revenue in the wake of suspended economic activities.

Top official sources confirmed to The News on Thursday that with maximum efforts, the FBR might be able to fetch Rs840-850 billion; therefore, the expected shortfall will be standing at more than Rs150-160 billion for the outgoing month. “Owing to halting of economic activities in the wake of lockdown and the PTI protest call, the revenue shortfall has aggravated. Earlier, there were projections that the FBR might have a shortfall of Rs100 billion, but now it seems that the shortfall would be more, standing in the range of Rs160 billion for the outgoing month,” said the official. The month is ending in just two days, but the FBR is heading towards a whopping shortfall in yet another outgoing month of the current fiscal year.

The FBR had already faced a shortfall of Rs189 billion in the first four-month (July-Oct) period of the current fiscal year. It collected revenues of Rs3,443 billion in the first four months against Rs2,784.4 billion in the same period of the last fiscal year, registering a growth in revenues by 25 percent. The FBR requires a revenue growth of 40pc for materialising its assigned target of Rs12,970 billion for the current fiscal year.

The government envisaged Rs12,913 billion for the current fiscal year under the IMF agreement. The parliament had granted approval for FBR’s target at Rs12,970 billion for the ongoing fiscal year, and it is expecting a shortfall of Rs230 billion during the second quarter (October-December) 2024-25.