Tax-to-GDP ratio increases to 10.5pc in FY2016: Dar
ISLAMABAD: The tax to GDP ratio has increased above expectation to 10.5 percent in fiscal year 2016/2016 due to hectic efforts of Federal Board of Revenue (FBR) to surpass the revenue collection target set for the last fiscal year.
This was informed by Finance Minister Senator Mohammad Ishaq Dar at a meeting with International Monetary Fund (IMF) on Thursday.
He said that the ratio of FBR’s tax to GDP has improved significantly over the last three years, from 8.45 percent in FY 2013 to 10.5 percent in FY 2016, which is beyond the projected increase of 10.2 percent for the period.
FBR not only achieved its annual target of Rs.3,104 billion but exceeded it, the finance minister said. “This indeed is a remarkable achievement as no downward revision was made in FBR revenue targets and the originally fixed target was achieved and exceeded which is an unprecedented accomplishment and speaks of the success of the economic policies being followed by the present government,” the finance minister praised FBR.
The performance of FBR becomes even more creditable when viewed in the context of the shortfall of Rs40 billion recorded in the first quarter. In the subsequent quarters, the indicative targets were met wiping out the deficit of the first quarter.
Against an end-year target of Rs.3104 billion, FBR collected Rs.3115 billion, according to provisional figures, which shows a growth in excess of 20 percent, over Rs2589 billion collected in FY2015.
In the process, the figure of FBR’s tax-to-GDP ratio registered a substantial increase of one percent.