Recommendations of the TF will
be made public to seek popular opinion before implementing the report
From SHAMIM AHMED
Feb 19 - 25, 2001
The much awaited report of the task force on restructuring of Central
Board of Revenue may be presented to the Finance Minister by the end of this month. The
task force led by Shahid Hussain, formerly of the World Bank was to submit its report in
December last but the same ran into snag because of difference of opinion between the
Chairman of CBR and the Task Force. The task force was asked to resolve the issue and
submit the final report by end of February.
The TF had engaged consultants about eight months ago, who launched a
study into tax procedures and operations for listing the distortions and corrupt practices
in implementation of the tax policy. These consultants presented a report, which was
examined by the Finance Minister before it was to be presented to the CE. The Finance
Minister and the CBR officials had found that the report was based on certain studies,
which had drawn wrong conclusions and a restructuring based on these conclusions would be
The Chairman is engaged these days in meetings with his consultants,
mostly from Private Sector, to finalise the recommendation for presentation to the Finance
Minister. The Finance Ministry had decided that the recommendations of the TF will be made
public to seek popular opinion before implementing the report. Stakeholders mainly the tax
payers and the public would be notified of the suggestions to revamp the CBR against whom
the tax payers have a plethora of complaints like corruption, harassment and misuse of
The establishment of the Task Force in July last year was part of
government's manifold efforts to bring about comprehensive improvement in the taxation
system. The establishment of Tax Ombudsman and tax advisory council were other initiatives
like the tax survey and documentation of economy drive.
Soon after its inception the Task Force formed certain subgroups, and
consultants were appointed to assist them. Consequently, a number of presentations were
made to the Finance Minister and the Chief Executive who had directed that nothing short
of a paradigm shift was paramount. Based on the analysis and findings of the consultants,
the subgroups and members of the task force discussed various issues at length. Among
other things, the terms of reference of the Task Force included.
review of existing management and policies of CBR and evaluation
of their effectiveness,
review of management of human resources i.e. recruitment training, promotion,
evaluation of performance and discipline.
review the compensation system with its effectiveness in attracting and motivating
qualified persons and ensuring integrity.
review the causes of corruption among staff and management of information for
effectiveness of the tax machinery.
review organizational structure in relation to needs for minimising costs, speedy
processing and decision making and engendering a sense of service and accountability.
It will also examine the organisational design and human resource
reforms, along with merging various managerial functional groups. The present system of
recruitment of personnel, training and compensation packages, performance evaluation,
separation of corrupt and honest officers and expenses would come under discussions during
the ongoing five day meetings.
Another key issue is of retaining the CBR in its present form or its
conversion to Pakistan Revenue Authority would be a focal point of reorganization of tax
administration, particularly as a consequence of livable compensation package for CBR
At early stage of establishment of the task force, finance minister had
indicated that to create a system of integrity in the tax department, an increase in
compensation package along with adequate infrastructure and information management system
would be imperative. An important question is the implementation of the report by the
government. In the past several reports of high-powered commissions and committees or
study groups on tax reforms have been largely scuttled. The general impression is that CBR
is averse to change. This was seen right from the beginnings of the task force on the
ground that the CBR itself was in the process of reforming the taxation system and has the
capability to do so. As things happened, the results of the documentation drive and survey
have failed to give anticipated enhancement in revenues. A shortfall of Rs.13 billion has
taken place. What is worse, the credibility gap between the taxpayers and the collectors
has surged upwards. The task force is laying great stress on implementation of the
recommendations to achieve the paradigm shift it is keenly working at as directed by the
Chief Executive and as the situation warrants.
It is pointed out that CBR has been rather apathetic to all reform
measures and various tax commission's reports have been lying in cold storage. It is for
the first time that quantum of CBR receipts, corruption, issues of reorganization and
reforms have been of immense concern in recent years, to the country as well as to the
donors. The reforms of the tax machinery and system are of critical importance for all
concerned. Along with quantum jump in tax receipts as well as in exports could save the
country from the tightening stranglehold of debt.