Pakistan(National Times)- ISLAMABAD: Amid measures aimed at boosting revenue generation and expanding the tax net, the federal government’s tax target for December 2024 is likely to face a shortfall of Rs80-90 billion, The News reported on Tuesday. With the promulgation of the presidential ordinance for slapping 44% tax on banking sector profits, the Federal Board of Revenue (FBR) is expecting collection of Rs70 billion with the deadline of corporate sector returns. Previously, the maximum rate on the banking sector stood at 55% but after an agreement, the average rate of tax was reduced to 44% for the tax year 2025. Under the agreement, the FBR is now expecting Rs70 billion by December 31, 2024, from the banking sector, which would help the tax machinery to reduce its shortfall. The tax authority had so far faced a shortfall of Rs340 billion in the first five months (July-Nov) period of the current fiscal as its collection stood at Rs4,295 billion against the desired target of Rs4,635 billion. Now with the expected shortfall of Rs80-90 billion, the overall shortfall in the FBR target might go up to Rs420 or Rs430 billion in the first half (July-Dec) of the current fiscal. As an indicative target agreed with the International Monetary Fund (IMF), the FBR is supposed to collect Rs6,009 billion till end of December and the tax machinery is required to collect Rs1,714 billion within the deadline. According to the presidential ordinance promulgated on December 29, transactions which are past and closed would not be affected. The banks would pay 44% tax in tax year 2025, 43% in 2026, and 42% in 2027. For small companies, a 20% tax rate would be made applicable in tax year 2026. For all other companies, the standard rate of 29% would remain applicable. According to the ordinance, amendments in the Seventh Schedule, Ordinance XLIX of 2001 — the said ordinance, in the Seventh Schedule, in rule 6C, in sub-rule (6A), (a) for the expression “2022 and onwards”, the figure “2023” shall be substituted; and (b) the existing explanation appearing at the end, shall be numbered as Explanation-1 and thereafter the following Explanation-2 and the proviso shall be added.