Federal cabinet meets tomorrow to discuss FBR’s restructuring  

ISLAMABAD: The federal cabinet will meet on Tuesday to discuss the restructuring of the Federal Board of Revenue (FBR) and the digitization of its services.

Caretaker Prime Minister Anwarul Haq Kakar has summoned a special meeting of the cabinet on the issue, according to sources.

The summary of the proposed changes in the FBR was forwarded by the caretaker finance minister after she agreed to some of the suggestions from the income tax officers.

The FBR top management has reportedly accepted the minutes of the Special Investment Facilitation Council (SIFC) that approved the separation of Customs and Inland Revenue Service (IRS).

Two new boards, Federal Board of Customs (FBC) and Federal Board of Inland Revenue (FBIR), will be established, while a separate Tax Policy Unit (TPU) will also be set up at the finance division as per the International Monetary Fund’s (IMF) recommendation.

The sources said that IRS and Customs officers have resolved their differences over who will collect withholding tax for each other. The Customs will act as a withholding agent for the IRS and transfer the tax receipts to it.

The director-general working in Customs will also be a member of FBC instead of heading it, sources added.

The sources said that Customs Intelligence will continue to investigate money laundering cases as well as other functions and powers mentioned in customs act 1969. The other powers will rest with Customs.

Earlier, income tax officers had raised objections about private members including tax practitioners and chartered accountants on FBR oversight boards, which they considered as a conflict of interest.

However, the finance minister told FBR officials that reforms in FBR were compulsory and have to be implemented at any cost. She said that government would not tolerate any resistance to tax reforms.