Autonomous status for CBR

According to a news report, the World Bank is pressing the government to convert the Central Board of Revenue into a fully autonomous organisation with authority to manage its own affairs without any interference from the finance ministry.
In the absence of any progress in the implementation of this demand, the World Bank has held back the release of its grant of $120 million which was sanctioned earlier for financing the taxation reforms in Pakistan, including the restructuring of the Central Board of Revenue. It may be recalled that a World Bank mission a few years ago, in one of its studies on the subject of reforms in the taxation regime, had recommended the establishment of an autonomous authority to replace the entire structure of the Central Board of Revenue (CBR).
Back in 1998, a Bill was also initiated in parliament by the then government which envisaged establishment of an autonomous Pakistan Revenue Authority to take over all functions of the CBR. However, for one reason or the other, the Bill could not be taken up for enactment and still lies in cold storage.
The process of taxation reforms has continued over the last couple of years in keeping with the recommendations made by the special committees constituted earlier for this purpose. A change in the status of CBR, however, has been, it appears, omitted from the agenda.
This shows that the government is not favourably disposed towards the idea of giving the CBR a fully autonomous status, although the actual position is that it enjoys full independence in the discharge of its functions as an authority to impose, assess and collect taxes, both direct and indirect.
CBR's freehand in the issuance of SROs amply testifies to its powers to act independently without any strings in the hands of the finance ministry to pull.
The Central Board of Revenue in Council wields rather an unlimited authority to restructure the taxation regime and as such it is vigorously implementing the taxation reforms with the objective of improving the relationship between the taxation departments and the taxpayers in all segments, namely, income tax, sales tax and customs.
The examples of the reforms it has introduced include the establishment of Large Taxpayers Units, Medium Taxpayers Units, implementation of Universal Self Assessment Scheme, creation of taxation facilitation centres throughout the country to win the confidence of taxpayers, minimising the discretionary powers of taxation officials, etc.
Introduction of automation and computerisation in various tax collection departments, are the other important steps. The simplification in procedures for refund of income tax and sales tax is designed to not only make the whole system transparent but also to eliminate long delays in the disposal of tax related matters, particularly in the case of customs clearance.
A closer analysis of the on-going taxation reforms would bring to light the irrefutable fact that the CBR is independently implementing these programmes without specific instructions from the Federal Cabinet. However, there can be no two opinions that the finance ministry must be kept fully informed of the progress and results or any hurdles in the reform process, because the finance ministry is answerable to parliament in respect of matters relating to taxation and the overall budgetary management.
In this context, the CBR would be supposed to co-ordinate closely with the finance ministry even if it was accorded an autonomous status. With this stipulation fully defined in its charter, there should be no hitch in converting the CBR into an autonomous authority through a Bill in Parliament.
The World Bank's proposal includes recommendations for making the CBR free from interference by the government in its administrative set-up including recruitment of personnel with specialised academic qualifications and experience.
The proposal does not seem to clash with the government's present policy of allowing all autonomous institutions to manage their affairs in all respects, including selection of officers and staff and fixation of their salary scales within their own budgetary framework.