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Holes in the budget

73 16 0
20.06.2021

Tax hole: The budget shows ‘Tax Revenue (FBR) of Rs5,829 billion’. On May 29, the FBR told us that it has collected Rs4,143 billion in 11 months. That means the FBR will end up collecting around Rs4,500 billion this year. How can the FBR collect a wholesome 30 percent more next year? If the FBR collects 15 percent more next year it will come to Rs5,000 billion or so. That would leave a hole of Rs800 billion.

Let’s look at the ‘tax hole’ from a different angle. Let us say that we will raise our GDP to Rs50 trillion. In FY2020, our tax-to-GDP ratio stood at 9.6 percent. That would mean tax revenues of Rs4,800 billion. Let’s say that we will raise our tax-to-GDP to 10 percent. That would mean tax revenues of Rs5,000 billion. That would still leave a hole of Rs800 billion.

Debt hole: The budget shows ‘External Loans of Rs2,673 billion’.........

© The News International


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