The Federal Board of Revenue (FBR) has unveiled a comprehensive transformation plan aimed at significantly boosting Pakistan’s tax-to-GDP ratio from the current 10.24% to 18% over the medium term. The ambitious initiative, presented to leading business figures during a high-level briefing, focuses on digitization, institutional reforms, and the strengthening of human resources to close long-standing revenue gaps.
The briefing, chaired by FBR Chairman Rashid Mahmood, included representatives from the Overseas Investors Chamber of Commerce and Industry (OICCI), the Pakistan Business Council (PBC), and other prominent business groups. Approved by the prime minister in October 2024, the transformation plan outlines a strategic roadmap to enhance tax compliance, streamline processes, and integrate technology-driven solutions to modernize Pakistan’s revenue administration.
Under the plan, the FBR aims to raise its contribution to the tax-to-GDP ratio to 14%, with provincial revenues projected to grow by 3% and the petroleum levy expected to add 1%, collectively achieving the 18% target. Officials emphasized that these measures are designed to close gaps in major taxes while fostering efficiency, transparency, and accountability in collection procedures.
Member Inland Revenue Operations, Dr. Hamid Ateeq Sarwar, presented a detailed overview of the plan’s implementation framework, highlighting reforms in three critical areas: people, technology, and processes. To enhance institutional capacity, the FBR plans to hire approximately 1,600 auditors to strengthen audit functions, with newly recruited officers undergoing specialized training at leading universities to align their skills with global corporate standards. Appointments will be based on integrity and performance, with officers evaluated through a reward and rating system and offered performance-linked incentives.
Demonstrations of technology-driven solutions were also presented, showing tangible results from recent reforms. The FBR’s tax-to-GDP ratio rose from 8.8% in 2023-24 to 10.24% in 2024-25, signaling early progress. Key initiatives include the Faceless Customs Appraisement system, which has boosted revenue per Goods Declaration (GD) by 17.3% while improving customs efficiency at ports by reducing dwell times and demurrage costs. Enhanced enforcement measures have generated eight times more revenue in 2024-25 compared to the previous fiscal year.
Chairman Rashid Mahmood highlighted the FBR’s commitment to taxpayer facilitation, announcing the creation of a new facilitation division at Karachi’s Large Taxpayer Office (LTO). Senior officers will address taxpayer concerns directly, ensuring a responsive and efficient system. Furthermore, the Chairman proposed establishing a joint committee comprising representatives from the PBC, OICCI, and FBR to resolve issues related to valuation rulings, procedural queries, and compliance challenges.
The transformation plan signals a decisive shift toward a modernized, technologically enabled, and professionalized revenue administration in Pakistan. By enhancing audit capacity, improving taxpayer services, and implementing cutting-edge digital solutions, the FBR aims to create a sustainable pathway to higher revenue collection and improved fiscal health.
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