Chairman tells Senate panel on finance: Govt asked to implement FBR restructuring within 30 days

ISLAMABAD: Federal Board of Revenue (FBR) Chairman Amjad Zubair Tiwana, Wednesday, informed the Senate Standing Committee on Finance that the Special Investment Facilitation Council (SIFC) has directed the caretaker government to implement restructuring in the FBR within 30 days.

However, the parliamentary panel raised the question about the jurisdiction of the interim government and the SIFC for issuing such directions on the FBR’s restructuring through legislation which is not covered under the mandate of the caretaker government.

The representative of the Law Division said that the caretaker government cannot be stopped from doing the legislative business. The caretaker government can make amendments as well as legislation.

FBR restructuring plan finalised

When the Chairman of the Committee asked the Law Division about the confirmation that the caretaker government can do legislation, the Law Division representative stated that there is no bar on the caretaker government from doing legislation and presenting its agenda. The business of the government cannot be stopped including legislation. In this regard, the Law Division had a detailed interaction with Senator Raza Rabbani.

Responding to this, the Senate Committee directed that the finance minister and law minister come to the next meeting and brief the committee about the jurisdiction of the caretaker government for making legislation.

Senator Sadia Abbasi said that the caretaker government is not competent to do legislation.

Senator Farooq H. Naik stated that the matter of restructuring in the FBR should be deferred till the next government.

The implementation modalities of the FBR’s restructuring has yet not been finalised. The Inland Revenue Department and Customs Department would be separated under the plan, Tiwana added.

The FBR chairman informed the committee that it is the desire of the finance minister to carry out restructuring at the FBR. In this regard, many meetings have been convened at the Prime Minister’s Office.

Under the FBR’s restructuring, Tiwana stated that 6-7 entities/boards would replace the existing structure of the FBR.

The chairman FBR stated that the government is undertaking the restructuring of FBR, and its finalisation requires amendments to the FBR Act of 2007. The committee raised a question about whether the Interim Government is mandated to undertake such restructuring.

Responding to different queries of the members of the committee, the FBR chairman said that the FBR’s restructuring has two main components. The short-to-medium term plan of reforms is already underway covering digital invoicing dedicated documentation law and broadening the tax base. The long-term FBR’s restructuring included the constitution of the Customs Oversight Board and the Inland Revenue Oversight Board.

The proposed Customs Oversight Board and Inland Revenue Oversight Board would comprise FBR, the secretary Revenue Division; the secretary Finance Division; the secretary Commerce Division, and private members.

Almost all Boards have private members under the proposed restructuring plan, the FBR chairman said.

The operational heads of the FBR would remain from services side (Inland Revenue and customs). The operations side would be controlled by the FBR officials and they would have total control. However, no private member would interfere in operations side of the FBR.

The performance evaluation of the proposed Director Generals of the IR and Customs would be done by the Customs Oversight Board and Inland Revenue Oversight Board. The key performance indicators (KPIs) would be assigned to the tax officials by the said Oversight Boards. The Boards would also evaluate the revenue collection performance and targets to be assigned to the IR and customs departments.

Similarly, there would also be a Federal Policy Board and Tax Policy Office separated from the FBR. The Federal Policy Board and Tax Policy Office would have their own separate functions. The government would also create separate wings to look after the human resource-related issues of the tax machinery.

The preparation of the Finance Bill would also be done at the level of the Federal Policy Board and Tax Policy Office, he maintained.

Tiwana stated that around 1,000 amendments would be required in different laws under the Board’s restructuring.

These included new legislation, amendments to the existing laws and abolition of old laws. The new laws would be introduced and some existing laws would be repealed.

Copyright Business Recorder, 2024