Despite the tall claims of the emerging economy by the government and it's institutions the revenue shortfall of the government for the fiscal year 2016-17 has increased tremendously.
The shortfall in tax collection has increased to over Rs150 billion in just eight months as the Federal Board of Revenue (FBR) has so far provisionally collected Rs1.91 trillion in the current fiscal year, compounding government’s fiscal woes in a pre-election year.
Tax receipts rose only about 7% in July-February of fiscal year 2016-17, according to FBR officials. In absolute terms, the collection was just Rs108 billion higher than the comparative period of previous fiscal year.
In February, the FBR could collect Rs222 billion, registering a sluggish growth of 3% or Rs6.5 billion.
The growth rates of tax collection were even below the nominal economic growth, which is estimated at around 10%. This shows huge leakages that the FBR has been unable to plug.
It was supposed to collect Rs2.064 trillion in the first eight months, but it fell short of the target by Rs154 billion, according to officials of the tax machinery.
The government has set this year’s annual tax target at Rs3.621 trillion, 16% higher than the collection made in the previous fiscal year.
However, the FBR has already declared the goal unrealistic, saying the finance minister set the target without taking tax officials on board.