The caretaker government has greenlit a comprehensive restructuring plan for the Federal Board of Revenue (FBR), as reported by the Apex Committee of the Special Investment Facilitation Council (SIFC). The reforms and restructuring plan, approved by the SIFC, is now set to undergo further scrutiny in the upcoming federal cabinet meeting.
A summary detailing the FBR’s restructuring plan is slated for presentation in the federal cabinet meeting following the receipt of the minutes from the last SIFC committee session. The proposed action plan aims at enhancing the efficiency of Pakistan’s tax administration while fortifying internal governance within FBR.
As part of the ongoing reform initiative, the caretaker government is contemplating the establishment of a dedicated Customs Board to oversee Pakistan Customs affairs, effectively separating it from the revenue collection process. This move is designed to better monitor smuggling activities and other elements, with revenue collection remaining within the FBR’s purview.
Additionally, the restructuring may lead to the formation of a separate Inland Revenue Board under the supervision of the Revenue Division. An alternative proposal suggests extracting the tax policy function from FBR.
Under the proposed tax reform program, five federal secretaries, including Finance, Industries and Production, National Food Security, Commerce, and Interior, are set to become ex-officio members of the Customs Board.
These restructuring measures aim to address apparent conflicts of interest in tax collection and enhance the overall performance of the tax machinery. FBR is also embracing innovative digital technologies to expand the tax base and bridge the gap in tax policy and compliance.
High-ranking officials at FBR have engaged in multiple meetings with the SIFC on the reform agenda, gaining approval last Thursday. Furthermore, the government is reportedly creating a new post, “Member Appraisement,” within the Customs Department, aiming to separate appraisement from operations and enforcement functions.
