ISLAMABAD (Agencies): In a historic achievement, the Federal Board of Revenue (FBR) has surpassed expectations by collecting an impressive Rs.1021 billion in December 2023. After accounting for refunds totaling Rs.38 billion issued during the month, the net collection stands at Rs.984 billion. Notably, both the monthly and six-month targets for the current financial year were exceeded.

The initial target for the first six months, set at Rs.4425 billion as per the agreement with the IMF, was surpassed by Rs.43 billion, resulting in a collection of Rs.4468 billion. In comparison, the FBR collected Rs.3428 billion during the corresponding six months of the previous year, marking an extraordinary increase of over Rs.1 trillion.

Despite challenges such as refunds totaling Rs.230 billion, exceeding the Rs.177 billion issued during the same period last year, and continuous import compression impacting revenues collected at the import stage, the FBR has successfully absorbed the entire impact through increased domestic revenue generation. The revenue mix at the import stage and domestic taxes, which used to be 50:50 in the past, has now shifted to 36:64.

The ratio of direct to indirect taxes has also witnessed a change, with the share of direct taxes increasing to 49% for the first six months. Remarkably, in December alone, the share of direct taxes reached 59%. This represents a significant 41% increase in the first six months compared to the corresponding period of the previous year.

Within direct taxes, the FBR has made strides in reducing the share of withholding taxes from 70% to 55-58% over the past two years. In December 2023, the share of withholding taxes dropped to 40%, showcasing effective tax management strategies.

This achievement is particularly noteworthy, considering that back in 2007-08, the FBR collected Rs.1 trillion as an annual collection, a milestone that took 50 years to reach. In a remarkable feat of progress, the FBR has now accomplished this milestone in a single month, within a span of just 15 years. The Chairman of FBR extends congratulations to Member (Customs Operations), Member (IR-Operations), and their teams for their dedicated efforts in achieving this unprecedented task. Gratitude is also extended to taxpayers for their continuous support and accurate declarations, without which this remarkable target could not have been accomplished.

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