Sales tax collection from electricity contributed 16 percent of the total sales tax collection (domestic stage/local supplies) during the first half (July-December) 2021-22, which remained the top revenue spinner of sales tax.
The Federal Board of Revenue (FBR) has compiled data of the sales tax collection from the domestic stage during 2021-22.
The overall net collection of Sales Tax Domestic (STD) was Rs. 382.7 billion against Rs. 408.1 billion in the first half of 2021-22. Major contributing commodities are petroleum products, electrical energy, textile sector, sugar, food products, cigarettes, cement, aerated water/beverage, iron & steel products. The share of the major 15 items contributed around 55 percent during the July-December period of 2021-22.
Electrical energy is the top revenue generator in STD with around 16 percent share in the collection. Sales tax collection from electricity amounted to Rs. 78.698 billion during the first half (July-December) 2021-22 against Rs. 76.965 billion was collected during the same period of 2020-21.
Now the POL products including oil refineries, oil marketing, and oil exploration have become the second top revenue contributor of sales tax domestic with a 13.6 percent share in STD collection.
Sales tax collection from petroleum products stood at Rs. 68.943 billion during the first half (July-December) 2021-22 against Rs. 114.561 billion collected during the same period of 2020-21.
Sales tax collection from sugar totaled Rs. 31.024 billion during the first half (July-December) 2021-22 against Rs. 27.306 billion during the same period of 2020-21, reflecting an increase of 5.4 percent.
As far as the growth is concerned, collection from auto parts increased by 42.6 percent, natural gas 25.9 percent, cigarettes 25 percent, iron & steel products 19.5 percent, FBR said.
The FBR’s data further disclosed that the sales tax on imports (STM) is a significant component of federal tax receipts. The share of STM in total sales tax net collection during the first half (July-December) 2021-22 is 70 percent against 55.5 percent in the corresponding period last year. The net collection of STM during the first half (July-December) 2021-22 stood at Rs. 892.3 billion against Rs. 508.6 billion in the corresponding period last year, registering a growth of 75.4 percent.
The top 15 commodities of sales tax import have contributed a major chunk i.e. 85.4 percent in STM collection. The detailed data indicates nearly 50 percent of STM is contributed by POL products (Ch:27), Iron and Steel (Ch:72), machinery (Ch:84), and plastic (Ch.39). POL is the leading source of sales tax collection at the import stage with 31.6 percent.
During H1 2021-22 collection from POL products was Rs. 282.1 billion against Rs. 110.5 billion during the first half (July-December) 2021-22, reflecting a growth of 155.2 percent. All major items have recorded positive growth and the items like vehicles, organic chemicals, iron & steel, oilseeds have grown substantially during the first half (July-December) 2021-22, FBR said.