Revenue collection positive even as economy teeters

Society Pakistan & World Affairs
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ISLAMABAD: Despite a slow down in economic growth, revenue collection hiked by 28.14 per cent in the first four months of the current fiscal year as it stood at Rs349.8 billion against Rs271.488 billion last year.

**Revenue collection also outpaced the target by Rs20 billion **on the back of unexpected growth in the collection of all taxes particularly general sales tax (GST) due to a more than 25 per cent increase in inflation.

Provisional figures released here on Saturday showed that revenue collection recorded growth of over 32 percent in the month of October as it reached Rs87.689 billion against Rs66.388 billion over the corresponding month last year.

Growth is expected to escalate further in the days ahead, when final figures - particularly for income tax - are finalized over the next few weeks.

The growth achieved in the period under review reflect that the economy is still showing positive signs despite imposition of more than 50 per cent additional duty on import of food and luxury items.

But the statistics also showed that tax authorities withheld the payment of refunds and rebates to taxpayers during the period under review to show positive results. Statistics showed that the payment of income tax refunds declined by 36.9 per cent in October 2008 over last year.

Sales tax refunds declined by 18.9 per cent and customs rebates by 75.7 per cent, respectively during the month under review against last year’s figures.

The government has increased the revenue collection target by 24.5 per cent to Rs1, 251.46 billion for 2008-09 from last year’s revised target of Rs1, 005 billion.

Tax-wise break up showed that the revenue collection under the head of income tax surged by 18.4 per cent at Rs112.102 billion during the July-Oct against Rs94.661 billion over the corresponding period of last year.

The sales tax collection reached Rs152.445 billion against Rs114.206 billion raised the same period last year, an increase of 33.4 per cent.

This highest ever growth in revenue showed that the 25 per cent increase in inflation helped the government in raising maximum revenue under the head of GST.

Statistics showed that the collection of federal excise duty rose by 33.6 per cent to Rs31.214 billion during the first four months as against Rs23.348 billion last year.

Customs duty collection up by 32.89 per cent to Rs51.925 billion as against Rs39.073 billion collected the same period last year. This also indicates the uninterrupted flow of goods into the country putting severe pressure on the balance of payments.

Source.

That is good to hear, some fruits from Musharraf era’s policy/governance. Good thing is that revenue collection didn’t decline. I hope ALL small businesses and big corporations become honest in their revenue collection and tax filings, we can have much better economy, more money to invest in country’s infrastructure.

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Re: Revenue collection positive even as economy teeters

It isnt total doom. There is a global downturn, coupled with security crisis and commodity inflation that smacked Pakistan upside its head. When security sorts out, FDI will return. Commodity prices are down again.

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:hmmm:Brother, since when this security crisis started? In April 2008 when thugs entered the corridors of power?:halo:

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Re: Revenue collection positive even as economy teeters

But it took a huge turn for the worse recently.

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Brother:

KSE started increasing in 2000 and was increasing until April 2008 when index reached highest on 18th April 2008. Since then it decreased over 40 percent when government put a floor on 27th August (shares could not be sold below the price it was on 27th August, resulting in no one to buy shares).

Pakistan dollar reserves started increasing in 2000 and kept increasing almost every month until Nov 2007 (last month of Shaukat Aziz in government). Dollar reserves were already record high (up to that time) at around 4 billion dollars before 11 Sept 2001.

Pakistani rupee is stable at around Rs 60 since 2000. Rupee got wobbly once Shaukat Aziz government finished in Nov 2007, still it was within Rs 62 to a dollar until April 2008, than it started falling and today it is Rs 84 to a dollar.

Pakistan GDP is giving good growth since 2002, with average real growth of over 7.5 percent between 2002 to 2008, registered GDP real growth rate of over 6 percent for year 2007-08, and was quite good (still it is reasonable) but it is deteriorating fast and even though government forecast was 5.8 percent growth for year 2008-09, expectation is that it may grow at around 3 percent or lower.

Pakistan export, that was $ 7.4 billion in 1999 (stagnant since early 90s), started increasing continuously since 1999, reached around $20 billion for year 2007-08, and still it is increasing rapidly.

GDP, that was stagnant throughout 1990s, started increasing from $62 billion in 1999 to $175 billion in 2008.

Per capita income that was decreasing throughout 1990s started increasing from less than $450 in 1999 to reach $1080 in 2008.

Tax collection, that was stagnant before 1999, started increasing rapidly, increased from Rs 308 billion in 1999 to over Rs 1000 billion in 2008.

Well ... same with most other things related to economy. So, please tell us when this terrorism started effecting Pakistani economy? And what happened in April 2008 that turned the table of rapidly growing Pakistani economy upside down? Please tell something logical and interesting, as I am curious. :)

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Re: Revenue collection positive even as economy teeters

Saleem bhai, thank you for pushing the thread into history.

Mujhey Zindagi kee dua na dey