Islamabad: The Federal Board of Revenue (FBR) has decided to enact the Tax Laws Amendments Ordinance, 2023, to raise PKR 300 billion in revenue, news sources reported on January 26.
Read: Tax Gap Analysis-2022: FBR reports PKR 28 bn income tax shortfall for salaried class
The amended ordinance will be promulgated by the FBR to shore up the revenue shortage of over PKR 200 billion in the current fiscal year (FY) 2022-23. The decision was made in response to the low revenue collection following the floods in August and the upcoming 9th review meeting with the International Monetary Fund (IMF). As per the sources, the government has decided to raise funds through the following measures:
PKR 60 billion will be raised from Federal Excise Duty (FED) on sugary drinks
PKR 60 billion will be raised from a 3% flood levy
PKR 45 billion will be raised from the revenue impact of the proposed withholding tax on banking transactions of non-filers
PKR 30 billion will be raised by increasing the rate of advance tax on the purchase/sale of the immovable property
PKR 25-30 billion will be raised from the impact of further raise in the FED on cigarettes
PKR 20-25 billion will be raised from the withdrawal of sales tax exemption on the import of raw materials/inputs used in the manufacturing of export goods under the ‘export facilitation scheme’
Read: FBR to publish names of high-value tax defaulters
PKR 20 billion will be raised from a tax on banks’ foreign exchange income
PKR 20 billion will be raised from a tax on banks’ foreign exchange income
PKR 10 billion will be raised from an increase in the rates of capital value tax rates on imported and locally-assembled vehicles
It is important to mention that the government has set a tax target of PKR 7.4 trillion for the current fiscal year. However, the FBR has fallen short of the total revenue collection predictions in the second quarter of the current fiscal year.
