LTO Karachi surpasses collection target to reach Rs1.6 trillion; posts 29% yearly growth

KARACHI: The Large Taxpayers Office (LTO), Karachi has surpassed the collection target for the fiscal year 2020/21, besides posting an increase of 29 per cent in the revenue collection, compared with the preceding fiscal year, according to the official figures released on Thursday.

The LTO Karachi is the major revenue collecting arm of the Federal Board of Revenue (FBR), and collected around Rs1.6 trillion during the fiscal year 2020/21 as against the assigned target of Rs1.56 trillion for the year under review.

Similarly, the tax office posted an increase of 29 per cent growth in the revenue collection to Rs1.6 trillion in 2020/21, compared with Rs1.24 trillion in the preceding fiscal year.

The LTO Karachi has collected around 40 per cent of the total inland taxes collected by the Federal Board of Revenue at the national level. The FBR collected Rs4.73 trillion in the fiscal year, of which the collection of Customs duty was Rs742 billion in the fiscal year 2020/21.

The revenue collection of the LTO Karachi reflects the profitability of bid companies, which are registered with the tax office for assessment.

The breakup of the revenue collection revealed that the tax office collected Rs249 billion as direct taxes in the fiscal year 2020/21, compared with Rs200 billion in the preceding fiscal year, showing an increase of 24 per cent.

Official sources said the ease in the coronavirus-related restrictions during the fiscal year under review helped the corporate entities earn profitability.

However, to provide relief to the business community, the LTO Karachi released income tax refunds of Rs54.23 billion during the year under review, compared with Rs29.7 billion in the preceding fiscal year, showing an increase of 83 per cent.

The collection of sales tax by the LTO also posted 31 per cent growth to Rs1.27 trillion, compared with Rs978 trillion during the comparative years under review.

Due to the increase in economic activities, the collection of sales tax, at the import stage, grew to Rs1 trillion, compared with Rs991 billion, showing a growth of 29 per cent.

Similarly, enhanced business and commercial activities helped the collection of domestic sales tax by 44 per cent to Rs300 billion, compared with Rs208 billion in the same period of the last fiscal year, showing an increase of 44 per cent.

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