ISLAMABAD: The Pakistan People’s Party (PPP) and Pakistan Muslim League-Nawaz (PML-N) have opposed the plan of the caretaker government to restructure the Federal Board of Revenue (FBR), saying it was beyond the mandate of the interim setup.

The Senate’s former chairman and PPP stalwart Mian Raza Rabbani, while talking to Dawn, said it was beyond the lawful and constitutional mandate of the caretaker government to enter into any exercise that would have a long-term and permanent effect.

“The mandate of the caretaker government under the constitution and the Elections Act is limited to looking after the day-to-day affairs of governance,” he remarked.

He further noted that the restructuring of FBR was far beyond the mandate of the caretaker government, as it involved policy matters having long-term effects and consequences and was therefore to be taken by the next elected government. Restructuring the FBR with the general elections less than three weeks away makes no sense, he added.

Responding to a question, Mr Rabbani said legislation was totally out of the domain of the caretaker government. When his attention was drawn to the reports that hundreds of amendments to existing laws and rules and fresh enactments would be required for the restructuring of FBR, he said the parliament was incomplete.

He commented that the use of Article 89 of the Constitution relating to the promulgation of ordinances was also out of question, as even for the elected governments, it is to be used in emergencies. “But here, heaven will not fall if FBR is not restructured before elections,” he remarked, adding that it would be against the mandate of the caretakers to promulgate an ordinance.

PML-N leader Senator Irfan Siddiqui, when contacted, said that any reform of national institutions like FBR should be left for the next government. He warned against any hasty decision with the general elections days away.

“If caretakers could not do it in over six months, how can they do it in less than three weeks?” he mentioned.

He said it has something to do with financial matters, including revenues and taxes, and such matters should come through parliament, which was incomplete.

“This, in my opinion, could not be done through an executive order,” he stated. Besides, promulgation of an ordinance for this purpose would also be inappropriate, and the caretakers may, however, come up with a blueprint and the incoming government can look into it, Mr Siddiqui said.

He added that right now, he had no access to information on the outline of the plan and purpose and had no idea if it was a home-grown plan or somebody had asked for it.

However, sources told Dawn that it was a demand from multilateral donors. As a result of restructuring, FBR is to be fragmented into six to seven entities.

Many believe that this will have no overall improvement in revenue collection and will rather complicate things. A source pointed out that the UK, after 300 years of its history, has unified Inland Revenue and Customs to create a single tax, payment, and customs authority, named HM Revenue and Customs (HMRC).

The source added that FBR under the plan is said to be fragmented into around six separate entities, including the Federal Board of Customs, the Federal Board of Inland Revenue, and separate oversight boards for customs and inland revenue administrations. The oversight boards are to be chaired by ‘independent, high-calibre professionals’ and include members from the public and private sectors.

Sources warn that a serious conflict of interest is likely to emerge between private members of the Oversight Board and the state.

One of the prime movers behind the creation of the Customs Oversight Board is Mukarram Jah Ansari, who was previously serving as Member-Customs Operations but was removed by the previous government due to his alleged complicity with and failure to tackle the smuggling networks operating in Karachi, where the Federal Investigation Agency (FIA) had even lodged FIRs against the customs authorities on charges of corruption.

Ansari is said to have prepared a list of proposed private members, which includes the names of Hussain Islam (political advisor to the incumbent PM), Saira Awan Malik (President TCS), and Manzoor Ahmed (retired Pakistan Customs Officer).

Hussain Islam and Dr Manzoor Ahmed are also part of the Task Force constituted on FBR Reforms.

Published in Dawn, January 20th, 2024