An editorial 'Manipulation of the non-tax revenue' has been published in Business Recorder Islamabad dated 20.07.2017. Two issues have been discussed ie (i) relocating of two items from non tax revenue to FBR revenue notably Gas Infrastructure Development Cess (GIDC) and Natural Gas Levy; (ii) rise in non-tax revenue Budget 2017-18 on account of reimbursement of coalition support fund (CSF), surplus profit of SBP and foreign grants. This misperception needs to be clarified to dispel the impression of any manipulation and misrepresentation of data on FBR tax receipts as well as non tax receipts. At the onset, it is suggested that all budgetary documents are on the website of Ministry of Finance (www.finance.gov.pk) which can easily be accessed. Further, attention is invited to table 9 at page 11 of Budget in Brief 2017-18 which provides details of tax revenue. The Tax revenue has two components (i) FBR Taxes and (ii) Other Taxes. While FBR taxes include Income Tax, Capital Value Tax, Workers Welfare Fund, Customs Duties, Sales Tax and Federal Excise, the other Taxes contain Gas Infrastructure Development Cess (GIDC), Natural Gas Development Surcharge, Petroleum Levy, Airport Tax and other taxes. From the above it is clear that GIDC and Natural Gas Development Surcharge are not part of FBR tax revenue.

As regards non tax budget estimates for 2017-18, it is stated that all estimates are received from the concerned departments/agencies. Budget Estimates on account of reimbursements of CSF are provided by the relevant agency with the explanation that these estimates are based on actual accrued reimbursements.

The working of surplus profit of SBP is based on the outstanding debt stock of the Federal Government held by the SBP and other incomes of SBP. After retaining administrative expenditure, surplus profit is transferred to the Federal Government by SBP. The borrowing of the Government from the SBP during 2016-17 was significantly higher as compared to last year while mark up rate is on the previous level, therefore, the income of SBP on this account will certainly be higher than the last year resultantly surplus profit by SBP will also be higher similarly. The estimates on account of foreign grants are provided by the EAD based on estimated scheduled disbursements by the donors. It is further clarified that external grants are reflected at two places (i) budgetary support grants which are received in cash are reflected as non tax receipts and (ii) project grants which are normally received in commodity and technical assistance are reflected under external resources. Therefore, these are two independent figures and unlike the writer's assertion.

(FINANCE DIVISION, GOVERNMENT OF PAKISTAN ISLAMABAD)

Copyright Business Recorder, 2017