The government has made a major change in how the tax policy is determined in Pakistan. From now on, the Finance Division, not the Federal Board of Revenue (FBR), will be responsible for all tax policy decisions.
The next federal budget will be prepared through the new tax policy office within the finance division, which will market a clear separation between tax policy and tax collection.
The change was announced during a meeting of the Senate Standing Committee for Finance, chaired by Senator Saleem Mandwala. Finance Minister Mohammad Aurangzeb explained that the Prime Minister is personally overseeing the FBRS change, with regular reports to ensure accountability.
The new tax policy office is almost fully staff, and a consulting board, including MPs and the private sector, will soon be formed to guide future decisions.
The committee also focused on other major financial concerns, including taking over the FBRS of the presidential order. Attorney General Men’s Over Usman Awan attended the meeting, where complaints were raised that the FBR challenged the presidential directive in the Sindh High Court instead of following it.
The lawyers of the affected citizens argued that the FBR needed to legally implement the President’s instructions and ignored the Prime Minister’s Office and the clear guidance of the Law Ministry. The Attorney General was asked to help resolve the dispute.
On the economic front, Minister Aurangzeb highlighted positive developments, such as Pakistan’s successful Eurobond payment – a sign of better financial discipline. He also mentioned the ongoing talks with China for the launch of a $ 250 million Panda Bond by the end of November as part of the big billion dollar investment project.
The members of the committee welcomed the latest works, but after the presidential and Ombudsman orders to ensure good governance and accountability, emphasized the importance of government agencies, including the FBR.