FBR Paid Refunds of Over Rs. 375 Billion in FY22

The Federal Board of Revenue (FBR) has paid refunds of Rs. 378.9 billion in the fiscal year 2021-22 (FY22) against Rs. 326.6 billion paid in 2020-21 (FY21), reflecting an increase of 16 percent. In line with the government’s policy to support the business community through expeditious refunds, the FBR made higher refund payments in FY22 as compared to the last fiscal year. During FY22 refunds amounting to Rs. 378.9 billion were paid. The refunds were higher by Rs. 52 billion as compared to the previous fiscal year. In order to facilitate the exporters, the manual rebate approval system has been replaced with RMS-based fully automated/ system-based processing of duty drawback payment without involving any human intervention. Under the automated system, the export good declaration is termed a rebate request. Direct taxes contributed 37.2 percent to the total tax collected during FY22. The net collection stood at Rs. 2,284.9 billion in FY22 reflecting a growth of 32 percent over the collection of Rs. 1,731.3 billion in FY21. The collection of direct taxes comprises withholding taxes (WHT), Advance Tax, Payments with Returns, and Collection on Demand (COD), FBR added. Sales tax remains the top revenue-generating source of FBR contributing about 41 percent share of the total collection. Sales tax recorded a growth of 27.4 percent during FY22. In absolute terms Rs. 2,532.2 billion was collected which is Rs. 543.9 billion higher than the amount collected in FY21. Despite the substantial increase in absolute terms, the target of sales tax was met to the extent of 98.3 percent which can be attributed to the high growth in payment of refunds whereby about Rs. 80 billion were paid over and above the amount of Sales Tax refunds paid during the previous fiscal year.