The Federal Board of Revenue (FBR) has proposed addressing potential conflicts of interest in appointing Inland Revenue officers to income tax appellate tribunals.
According to the proposal, approximately 20 positions currently held by these officers will be replaced with retired officers to ensure impartiality and neutrality in decision-making.
The change is under review, and necessary legislative actions are being planned for implementation. The FBR has noted that this adjustment will not affect the appointments of customs officers in customs appellate tribunals. However, the proposal could impact the career progression of Inland Revenue officers, as 21 out of 52 IRS Grade 21 officers are currently serving in these tribunals.
The move comes after the Pakistani government met another condition set by the International Monetary Fund (IMF), which included withdrawing key powers from the FBR. This was part of a broader initiative to establish a Tax Policy Office under the Ministry of Finance to segregate tax policy formulation from collection. This separation is intended to enhance transparency and efficiency in tax administration.
Under the new framework, the FBR will focus solely on tax collection and implementation, while the newly established Tax Policy Office will take charge of policy formulation. Reporting directly to the Finance and Revenue Minister, this office will develop reform agendas, analyze tax policies and proposals, and provide policy reports on income tax, sales tax, and federal excise duty. Its goals include reducing tax fraud and strengthening enforcement mechanisms.
The restructuring of the FBR is part of efforts to boost revenue generation, close tax loopholes, and enhance economic governance. Aligning with commitments to the IMF, these reforms are designed to foster a more autonomous and effective tax system.