During the first four months of the ongoing fiscal year (July-October 2021), tax revenue of Pakistan grew 37% on a year-on-year basis to Rs1.84 trillion, which is no mean feat.
However, the mammoth tax collection is a byproduct of an unusual increase in import duties and it was recorded alongside expansion in import volumes.
According to the Pakistan Bureau of Statistics (PBS), merchandise imports during July-September 2021 surged 66% to $18.75 billion against $11.3 billion in the same period of last year.
The increase in collection of indirect taxes contributed heavily to the growth in the overall tax revenue collection. Out of Rs1.84 trillion collected during the four months under review, Rs1.21 trillion, or 66%, was received under the head of indirect taxes, statistics of the Federal Board of Revenue (FBR) revealed.
The reason why tax revenue grew almost invariably on the back of these two elements is that the country…