SBP Criticizes FBR for Declining Sales Tax Filers and Revenue Shortfall

• The State Bank of Pakistan is concerned about the Federal Board of Revenue’s performance.
• There is a decline in sales tax filers on the Active Taxpayers List.
• Only 1.18 million taxpayers were added in the first half of fiscal year 2024-25, down from 1.33 million the previous year.
• The FBR did not meet indirect tax collection targets, resulting in a Rs384 billion shortfall.
• The shortfall is due to macroeconomic factors and weak FBR administration.
• Overly optimistic projections for GDP growth, inflation, imports, and manufacturing affected tax collections.
• Lower imports impacted sales tax and customs duties revenues.
• The FBR’s enforcement and compliance mechanisms are weak.
• The SBP urges the FBR to improve taxpayer outreach and compliance.
• The SBP has previously advised better coordination and data integration with the FBR.
• The FBR needs to enhance compliance and modernize tax administration for fiscal sustainability.

Source: pkrevenue.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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