Won’t tolerate corruption in FBR: Shehbaz

Shahbaz says low revenue collection biggest challenge

LAHORE:

Prime Minister Shehbaz Sharif, while acknowledging the possibility of inadvertently removing some honest officers during a recent purge in the Federal Board of Revenue (FBR), stated on Saturday that his government would not tolerate any corrupt officers within the tax authority.

"We might have made an honest mistake in removing some upright officers; if so, we will rectify the matter," Shehbaz said on Saturday while addressing a ceremony in Lahore held to honor honest and hardworking FBR officers.

The prime minister emphasized that the time had come "to separate the wheat from the chaff" and to base decisions of reward and punishment purely on merit.

This ceremony appeared to have been organized to alleviate fears and concerns among FBR officers following the purge, during which eleven of their most senior officers were removed based on adverse reports prepared by intelligence agencies.

The move was met with disapproval by members of the Pakistan Customs Groups, who reportedly passed a resolution demanding that details of the investigations be made public.

The PM highlighted that the biggest challenge facing the country is the low revenue collection in relation to the tax-to-GDP ratio.  He stated that, by conservative estimates, Pakistan's revenue generation should be three to four times its current level.

Adding a rough estimate, he said that if revenue collection currently stands at Rs9 trillion, and the lowest end of the conservative estimate, which is three times, is employed, then our revenue generation should be '21 trillion' (27 trillion).

He remarked that this untaxed revenue was being siphoned off due to greed, fraud, and corruption—a situation that compels Pakistan to seek assistance from lenders.

"This is a promise I made when I was elected as the PM two months ago, that step by step we would begin to distinguish between right and wrong in all major departments."

He said a new crop of officers would be elevated in the FBR purely on merit.

He regretted that Rs2.7 trillion was under litigation for over a decade at Appellate Tribunal Inland Revenue. He said a new law has been made to help expedite these cases.

Shehbaz said new officers would be inducted through tests while their viva would be taken by people of impeccable repute.

He was referring to Appellate Tribunal Inland Revenue (ATIR) members, who would be appointed through an open competition under the new scheme.

The PM said he had proposed a salary of Rs3 million for the ATIR members but the attorney general suggested keeping it on a par with the pay of high court judges to avoid any discrepancy.

He cited a case of tax fraud in which the national kitty was deprived of Rs750 billion via fake tax receipts. “This amount is just tip of the iceberg as only tax books of three years have been reviewed.”

He also termed the track and trace system introduced by the PTI government as the biggest fraud committed in the national history. He warned that if this system does not deliver, they will outsource it. “It is a point of introspection,” he said.

Earlier, the prime minister gave away the shields to the honest and hardworking officers of the FBR and said that he was feeling proud that the country had plenty of such honest officers which could play their due role in development and prosperity of the country.