Tax officials in Pakistan have expressed concerns about the proposed restructuring of the Federal Board of Revenue (FBR), citing a lack of transparency, the absence of an implementation mechanism, and inadequate ownership by relevant ministries.
Officers are reportedly concerned about possible threats to the federation’s financial independence owing to fragmented management and taxation without a well-thought-out plan. They have threatened legal action if the restructure plan gets accepted by the temporary finance minister.
The present FBR structures, built with the support of foreign financial institutions in the late 1990s and early 2000s, are thought-out, and the existing tax collecting system is the consequence of those changes.
However, according to reports, the suggested reorganization plan lacks clarity, precise information on administrative boards, and uncertainty regarding the tax charging and collecting sectors.
The caretaker administration highlights the need of restructuring in order to increase the tax-to-GDP ratio and taxpayer convenience. Despite this, there is a lack of clarity on how the plan would involve agricultural, retail, and real estate industries in the reorganization.
According to critics, the planned restructure would further fragment the revenue service, thereby interrupting the income stream and hurting current fiscal year objectives.
