Pakistan considers restructuring Federal Board of Revenue

The Pakistani government is considering the restructuring of the Federal Board of Revenue (FBR) or the establishment of a new tax collection agency to address difficulties in increasing national tax revenues and expanding the tax net.

Following a high-level meeting, proposals have been made to potentially create an entirely new institution. The Prime Minister's Office has directed the FBR to submit comprehensive proposals regarding human resource reforms, institutional improvements, and restructuring by October 19. While rumors of outsourcing tax collection to a private company have been dismissed as baseless, officials noted that creating a new national tax agency would require amendments to several laws, including the FBR Act 2007.

Reasons for considering these changes include a stagnant tax-to-GDP ratio and failure to meet revenue targets. An FBR spokesperson noted that while tax collections rose from 9.2 trillion to 13 trillion rupees over two years, this increase was partly attributed to additional taxes and slight economic growth.