Islamabad: In response to a looming revenue shortfall, the Federal Board of Revenue (FBR) is contemplating a 1% increase in withholding tax rates starting October 1, 2024. This measure is proposed to counteract lower-than-expected tax collections if September’s figures also fail to meet targets.

According to Zameen.Com, the FBR’s potential increase is set as a contingency plan outlined in a supplementary Finance Bill, should the revenue for September not align with projections. This follows a pattern observed in the first two months of the fiscal year, where July and August saw the FBR collecting PKR 1,456 billion, falling short of the anticipated PKR 1,554 billion.

The expected shortfall has been partially attributed to decreased taxes from imports, affecting the projected 18% growth in domestic taxes. To combat these revenue gaps, the FBR is enhancing its efforts in tax collection by integrating digital monitoring systems and advancing data analysis techniques aimed at identifying and reducing illegal sales tax adjustments.