THE caretaker government is reported to have ramped up the implementation of its plans to restructure the Federal Board of Revenue amidst growing opposition from within the FBR, as well as from major political parties. Media reports suggest that the interim finance minister, Dr Shamshad Akhtar, intends to implement the FBR reforms programme through a presidential ordinance before the end of this month — less than 10 days before the polls. According to some reports, she believes that the reforms would boost tax revenue collection from the existing 8.5pc to 15pc in a few years’ time. On its part, the FBR bureaucracy is against the plan — which was approved by the military-backed Special Investment Facilitation Council earlier this month — for fear of losing its infinite privileges and having its discretionary powers reduced. The politicians are opposed to it on the grounds that the interim set-up does not have the mandate to execute policies that can have long-term and far-reaching consequences. Hence, they want to leave the decision about FBR reorganisation to the next elected government. While there can be no two opinions on the constitutional limits of the mandate of the interim set-up, the opposition from FBR officials seems to be motivated by selfish reasons.
Even if reports claiming that the establishment had intervened to bridge differences between the minister and top revenue officials are correct, it would be a bad move to implement such crucial reforms through an ordinance. There is no doubt about the urgency and importance of reorganising the Board, separating policy from tax collection, introducing technology and reducing the discretionary powers of FBR officials to make taxation equitable and fair, as well as boosting collection. But it is best to leave this job to the next elected parliament. Should the caretakers go ahead with it, the reforms would lose their legitimacy, and the new government might have to rescind them even before the execution of the plan. The concerns raised by both PML-N and PPP leaders regarding the plan are not misplaced. If Dr Akhtar wants the Board to be restructured, she must work more extensively on the blueprint of the reforms and leave the job of legislating and implementing it to the incoming dispensation. Once a policy gets mired in controversy, it is never easy to move ahead with it.
Published in Dawn, January 23rd, 2024
