Prime Minister Shehbaz Sharif emphasized the urgent need for digitizing the Federal Board of Revenue (FBR) and improving its enforcement mechanisms to drive economic reforms in Pakistan. In a meeting held on Friday to review FBR matters, the Prime Minister directed relevant authorities to devise a comprehensive strategy to enhance FBR’s efficiency and enforcement capabilities.
The meeting, aimed at aligning FBR’s objectives with broader economic reforms, reflected the government’s focus on boosting tax revenue, improving service delivery, and fostering a stronger economy. According to a press release from the PM Office, Shehbaz Sharif acknowledged FBR as the backbone of the national economy and commended its ongoing transformation efforts.
FBR’s Role in Economic Development
Prime Minister Sharif highlighted that improved tax collection and enforcement would not only strengthen the national economy but also improve public services and the social sector. He called for involving prominent taxpayers and other stakeholders in FBR’s transformation plan to ensure effective implementation of the required reforms.
Additionally, the Prime Minister urged authorities to seek the necessary amendments and approvals from the relevant government departments to facilitate the transformation. His remarks underscored the government’s commitment to promoting the private sector as a critical component of economic growth.
Sharif also ordered a third-party audit of FBR’s ongoing projects and pushed for more robust efforts to curb smuggling, a persistent issue that negatively impacts the country’s economic health. He emphasized that addressing these problems would lead to stronger tax enforcement and revenue generation.
FBR Transformation Plan
During the meeting, officials presented the details of FBR’s transformation plan, which focuses on leveraging technology to enhance tax collection and enforcement without hampering economic development. The plan also includes initiatives for recognizing and rewarding efficient officers, which is expected to encourage better performance across the board.
Formulated over 40 days by FBR officers and economic experts, the transformation plan aims to facilitate honest taxpayers while cracking down on tax evaders. One of the primary objectives is to ensure that tax collection processes are fair and transparent, minimizing fraud and preventing tax evasion through stricter penalties and more efficient monitoring systems.
The plan also includes innovative strategies for enforcement, such as introducing technology-driven solutions to monitor transactions and identify discrepancies in tax payments. Additionally, the plan will impose restrictions on individuals and entities that fail to meet their tax obligations on time. These measures will be implemented after consulting honest taxpayers, ensuring a balanced and fair approach to tax enforcement.
Implementation of the Transformation Plan
As part of the transformation plan, the Prime Minister approved the “Home Grown Transformation Plan,” which was developed in response to his directives. The plan was created after extensive consultation with economic and technology experts and an in-depth analysis of the last 25 years of tax receipts.
In the initial phase of the transformation, efficient and skilled officers will be posted to Karachi, the country’s largest taxpayer unit, which contributes 32% of total tax receipts. These officers will work closely with auditors and experts to ensure effective tax collection.
The plan also includes a reward system for top-performing officers and mandates professional degrees from top universities for officers after their training programs. This initiative is expected to attract talent and improve overall performance within the FBR.
Customs Enforcement and Anti-Smuggling Measures
To address the issue of custom duties theft, the government has developed a new appraisal and enforcement mechanism. Under this mechanism, appraisers and inspectors will be randomly assigned tasks without prior notice and will be closely monitored through surveillance cameras to ensure accountability.
Moreover, the government plans to collaborate with the Frontier Works Organization (FWO) to establish new check posts aimed at curbing smuggling. A carrot-and-stick approach will be adopted to enforce strict discipline among customs inspectors, ensuring they are held accountable for their duties.
The meeting was attended by several high-ranking government officials, including Federal Ministers Ahsan Iqbal, Azam Nazeer Tarar, Ahad Khan Cheema, Muhammad Aurangzeb, Abdul Aleem Khan, and Dr. Musaddik Malik. Other attendees included the State Bank Governor, FBR Chairman, and senior government officials.