ISLAMABAD, July 19: Major changes are being introduced in the Central Board of Revenue, including vigorous implementation of the tax policies with a view to further enlarging its tax base, says a senior government official.

"Our tax base has significantly widened, as we have successfully achieved a four per cent increase in tax-to-GDP ratio and this is no mean an achievement,” Revenue Division Secretary-General and CBR Chairman Abdullah Yousuf told Dawn on Wednesday.

"The number of taxpayers has also increased from one million to 1.5 million due to which our tax-to-GDP ratio has increased from nine per cent to 9.4 per cent," he maintained.

He explained that the central bank's third quarterly report released on Saturday did not mention the reduction in the tax-to-GDP ratio of the CBR.

The report, he said, was referring to the reduction in the overall tax-to-GDP ratio of the country that included federal and provincial taxes plus various surcharges. There might be some reduction in surcharges due to which the country's overall tax-to-GDP ratio had gone down from 11 per cent to 10.4 per cent as was pointed out by the central bank, he said.

However, he said the CBR was consistently showing an increase in taxes as well as the number of taxpayers across the country. The CBR, he pointed out, was moving in an organised manner that first helped it achieve 20 per cent growth in taxes in 2004-05 and then 22 per cent increase in the financial year 2005-06.

"Since there is no more coercion, people are adequately filing their tax returns and today they feel more relaxed and confident to get themselves registered with the CBR," Mr Yousuf added.

He said that there was economic buoyancy that helped various sectors, including the CBR, to manage good growth. "We have considerably removed leakages and loopholes through our procedures which provided an opportunity to the CBR to collect additional Rs120 billion in the last financial year," he added.

Responding to a question, the secretary-general said that 13 regional tax offices were supposed to become functional soon along with three large taxpayers units. "Our customs clearance system has improved during the last five years and now the average clearing time has reduced to just five-and-a-half hours," he claimed.

He said all the functions of the CBR were being made fully transparent so as to avoid different kinds of complaints from any individual or a company.

Mr Yousuf pointed out that once the restructuring of the CBR was completed by 2009, things will greatly improve, with the CBR becoming one of the important organisations in terms of collecting more and more revenues and that too without creating problems for the taxpayers.

The World Bank and the British Department for International Development (DFID) have given $150 million to Pakistan for the restructuring of the CBR.