ISLAMABAD: The government has on Wednesday created a new post for a Member Policy Inland Revenue (IR) in the Federal Board of Revenue (FBR), taking the bifurcation of policy and operational functions a step further. The move will likely irritate the World Bank, and may delay the second phase of its reforms programme in the tax authority.
According to a notification, the government has appointed Asrar Rauf as Senior Member Inland Revenue Policy. Rauf was previously serving as the acting secretary of the Capital Administration Development Division. The move marks a third major reshuffle in the FBR bureaucracy in less than a week.
Rauf is due to retire on September 5, leading to speculations that the government might either offer him a new contract, or give him an extension, as he has been brought back to help achieve the tax target for this year.
The FBR on Tuesday also created two additional posts of Member IR South and Member IR North, purportedly under political compulsions. It has appointed Ijaz Hussain Shah as Member IR North; who, according to sources, is backed by a real estate tycoon in Islamabad.
Interestingly, Rauf had been ousted earlier from the FBR in 2011 as a scapegoat; to save the skin of then FBR chairman Salman Siddique in a scandal involving fudging of tax figures. Shah was involved in both the tax fudging scandal of 2011 (he purportedly obtained advances for artificially bridging the gap), and in the latest Rs47 billion scam involving illegal tax waivers extended to telecom companies.
When contacted, FBR spokesperson Riffat Shaheen Qazi rejected the notion that the appointments were made under political pressure, and said these were routine transfers and postings.
The government has not yet appointed a Member IR South, as many political heavyweights are eying the post and pressuring the FBR chairman, our sources added. FBR Member Strategic Planning Azra Mujtaba is likely to be transferred to the finance ministry as additional secretary in a few days, vacating yet another post, sources revealed.
Member IR Shahid Hussain Asad has, for the time being, been posted as Member IR Training, as he is likely to be transferred out of the FBR and will join a ministry. Asad’s name has also surfaced in the telecom companies’ tax waiver scandal. Sources said Member Human Resource Raana Ahmad has raised objections over the creation of the IR Training post, arguing it is duplication of work.
FBR’s decision to bifurcate the operational and policy functions of the Inland Revenue department has cast doubts over the signing of a new loan worth $300 million for the second phase of reforms in the authority. The tax authority has had to reverse similar decisions in the past, upon criticism from the World Bank. The sources said that the World Bank was of the view that it is due to such line ministries that chances of pilferages increase and there are significant delays in decision making.
The first phase, known as the Tax Administration Reforms Programme, worth $149 million, was dubbed as the most problematic project by the World Bank and deemed an utter failure. The FBR had used most of the borrowed money in constructing buildings and purchasing cars, instead of spending the funds on introducing new technology.
Published in The Express Tribune, August 9th, 2012.