ISLAMABADL The Federal Board of Revenue (FBR) is facing a significant shortfall in tax collection for August, missing its target by Rs113 billion. Sources within the FBR reveal that the authority collected Rs785 billion over the 30 days of August, against a target of Rs898 billion.
However, the FBR remains optimistic that revenue collection on the final day of the month might reduce the overall shortfall. Final data for August’s revenue collection will be available on Monday.
In contrast, the FBR exceeded its target for the first month of the financial year in July, collecting Rs659.2 billion against a target of Rs656 billion. Combined, the total tax collection for July and August stands at Rs1,445 billion.
The government’s overall tax collection target for the current financial year is a record Rs12,970 billion. The government has reportedly assured the International Monetary Fund (IMF) that it will implement a mini-budget if there is a significant revenue shortfall in the first quarter.
As the FBR strives to meet its ambitious targets, the final revenue figures for August will be crucial in shaping the government’s fiscal strategy for the upcoming months.
Meanwhile, the Ministry of Finance has released its latest monthly economic update, indicating significant improvements in Pakistan’s economic landscape. The report highlights a gradual decrease in inflation, which reached its lowest level in 32 months in July 2024, marking a positive shift in the economy.
In July 2024, the inflation rate dropped to 11.1%, a sharp decline from the 28.3% recorded in the same month of the previous fiscal year. This reduction in inflation is viewed as a significant success for the government’s economic policies aimed at stabilizing the economy and easing consumer burdens.
The report also highlights other key economic indicators. Remittances surged by 47% in July, reaching $3 billion, providing a positive boost to the country’s balance of payments. Exports grew by 12.9%, reaching $2.4 billion, while imports rose by 16.3% to $4.8 billion, indicating robust trade activity that could support economic growth in the coming months.
The Ministry of Finance also reported a 22.7% increase in tax revenue in July, amounting to Rs660 billion. Additionally, non-tax revenue surged by an impressive 78.3%, reaching Rs3,050 billion on an annual basis. These improvements in revenue collection are expected to strengthen the government’s fiscal discipline and reduce reliance on external borrowing.
