The revenue collection target of Rs2,810 billion for the fiscal year 2014-15 is too ambitious, says a government report.
The projected increase of 24.3 per cent in tax collection target will largely be missed because historically the highest growth in tax collection that Pakistan has ever achieved was 22pc, said a report of the Pakistan Institute of Development Economics (PIDE) released here on Tuesday.
The over-projection of revenue collection target also has a cost in terms of transfer of money to provinces, but the government did not take into account this cost at the time of finalisation of budgetary projections.
One problem in setting the ambitious tax collection target was that estimates of transfers under the NFC to provinces were based on tax collection budgeted at the federal level.
“The non-realisation of the federal government’s revenue target by a wide margin disturbs the provincial budget,” the report said.
