Mohsin Siddiqui (Chief Reporter)
federal government has given the green light to a comprehensive plan aimed at restructuring and digitizing the Federal Board of Revenue (FBR) to align with international tax and revenue management standards. The approval came during a federal cabinet meeting chaired by caretaker Prime Minister Anwaar-ul-Haq Kakar.
The decision follows recommendations put forth by the Revenue Division, emphasizing the need to modernize FBR operations in line with global best practices. The restructuring plan entails the establishment of a Federal Tax Policy Board within the Revenue Division, tasked with formulating tax policies and coordinating revenue targets.
Under the proposed reforms, the Customs and Inland Revenue departments will be segregated, each operating under specific director generals vested with full authority over administrative, financial, and operational matters. Digitization of departments and adherence to global standards for transparency and complaint resolution will be ensured.
Additionally, separate oversight boards will be instituted, comprising federal secretaries, ministry representatives, and relevant experts, with the finance minister heading these boards. The appointment of private sector experts will be conducted to avoid conflicts of interest.
The caretaker prime minister underscored the importance of presenting a draft legislation for necessary approval in the upcoming parliamentary session, in accordance with the cabinet committee’s recommendations for reforms.
The meeting also acknowledged the efforts of ministers, FBR officials, and relevant authorities in formulating these reforms. Meanwhile, decisions regarding amendments to the Indus River System Authority Act were deferred for further deliberation.
It’s worth noting that the International Monetary Fund (IMF) has proposed various options for restructuring the FBR, including transforming it into a single national tax authority or enhancing its functionality as a federal tax agency with coordinated provincial linkages. The IMF’s Technical Assistance Report advocates for robust governance, performance management, and fixed tenures for tax authority leadership to ensure effective revenue administration.
