Cabinet greenlights overhaul, digital transformation of FBR

A Federal Tax Policy Board will be established within Revenue Division as part of approved reforms

ISLAMABAD:

In a meeting held on Tuesday, the Federal Cabinet granted approval for the restructuring and digitisation of the Federal Board of Revenue (FBR), based on recommendations from the Revenue Division.

Chaired by Caretaker Prime Minister Anwaarul Haq Kakar, the meeting reviewed the suggestions of an inter-ministerial committee that convened on January 23, led by the caretaker finance minister.

Significant amendments were made during the previous meeting, following a comprehensive debate. The updated summary was presented in the current cabinet session, as per a statement from the PM Office.

As part of the approved reforms, a Federal Tax Policy Board will be established within the Revenue Division, responsible for developing tax policies, setting revenue targets, and promoting coordination among stakeholders. The Federal Minister for Finance will head this policy board.

Under the new framework, the Customs and Inland Revenue departments will be segregated and operate under specific director generals in their respective cadres. These officials will have complete authority over administrative, financial, and operational matters. Both departments are tasked with digitising their operations and implementing globally recognized practices for transparency and complaint resolution.

Also read: IRS appeals to ECP on FBR restructuring

Separate oversight boards will be established for these departments, comprising federal secretaries from the ministries of finance, revenue, trade, the chairman of NADRA, and relevant experts, with the Minister for Finance heading these boards.

The prime minister emphasised the need to avoid conflicts of interest during the appointment of private sector experts. He also directed that a draft be presented, based on the cabinet committee’s reform recommendations, for necessary legislation and approval in the upcoming session of the newly elected parliament.

During the meeting, the caretaker PM and cabinet members commended the relentless efforts of the ministers, the Chairman of FBR, and other relevant authorities in formulating these reforms.

Additionally, the meeting endorsed decisions made on January 26 by its cabinet committee on legal affairs but deferred amendments proposed by the Ministry of Water Resources regarding the IRSA Act 1992. It directed a resubmission of the amendments in the next cabinet meeting after thorough deliberation.