FBR seeks more staff, resources to bridge Rs7trl tax gap

- 81
- 0
ISLAMABAD: The Federal Board of Revenue (FBR) has called for additional staff and logistical resources to tackle Pakistan's massive Rs7 trillion tax gap.
According to FBR officials, a crucial part of the strategy is to enhance field operations and expand informant networks to reduce tax evasion. Currently, the FBR faces major challenges in overseeing tax activities across the country due to limited resources and manpower. The tax authority operates with only 25 offices nationwide, which is deemed insufficient for effective monitoring. Additionally, the FBR receives just Rs1 for every Rs200 of income, highlighting the need for more financial resources to carry out its functions efficiently. In comparison, India allocates 1.5% of its total revenue for tax operations, whereas Pakistan's expenditure is only 0.44%. This disparity underscores the significant resource gap. Furthermore, provincial departments are receiving salaries and benefits that are 20 times higher than those of the FBR, further straining its capacity to manage the tax system effectively.
To monitor key sectors such as sugar, cement, tobacco, and fertilizers, the FBR emphasizes the necessity of more resources, including vehicles. In the 2022-23 fiscal year, the Punjab Revenue Authority set a tax collection target of Rs240 billion, which also illustrates the need for robust tax operations and resources. The FBR also faced severe criticism earlier for planning to purchase 1,010 new cars, each with a 1200cc engine, for officers at a cost of Rs3 billion. A Senate panel raised concerns about the lack of competition in the bidding process, with some claiming that the contract was awarded directly to Honda Atlas despite a lower bid from Indus Motors by Rs200,000. These issues highlight the ongoing debate over how best to allocate resources within the FBR.