Islamabad: The Federal Board of Revenue (FBR) has demonstrated a robust financial performance in the initial two months of the fiscal year 2024-25, with a gross revenue collection amounting to Rs. 1,588 billion. This collection surpasses the set target of Rs. 1,554 billion, marking a significant stride in the nation’s fiscal management.

According to Federal Board of Revenue, the net revenue collected by FBR in July and August was Rs. 1,456 billion, after issuing refunds totaling Rs. 132 billion to exporters, which is 44% higher than the refunds issued last year. This measure was aimed at easing the liquidity challenges faced by exporters. The data reveals impressive growth in various tax segments, particularly in domestic taxation. The domestic income tax collected was Rs. 593 billion, up by 36% from the previous year’s Rs. 437 billion during the same period. Additionally, there was a 40% increase in domestic sales tax collection, which nearly reached Rs. 314 billion.

Despite these gains, the performance on the import front showed a different trend, with a continued decline in import volume impacting customs duties and other import-stage tax collections. The FBR reported a 2.2% decrease in imports measured in US dollars and a 7% decrease in PKR terms in August 2024 compared to August 2023. High duty items such as vehicles and home appliances, along with consumer goods like garments and footwear, saw significant reductions, altering the import mix and affecting overall tax collections from imports. However, there was a modest 4% increase in the collection of Customs duties.

The Federal Board of Revenue remains optimistic about meeting the revenue targets for the first quarter, anticipating a resurgence in economic activities and imports in September 2024. This expectation is supported by recent government interventions, including a reduction in the policy rate. Furthermore, ongoing digitization efforts and other reforms, such as enhanced monitoring of supply chains, automated production monitoring, and strict integrity management of the FBR workforce, are expected to substantially boost revenue collection. These reforms are being closely supervised by the Prime Minister and the Finance Minister to ensure their effective implementation and to facilitate business growth.