PBC Urges Caretaker Govt to Include Taxpayers in FBR Policy Board

Pakistan Business Council (PBC) has asked the caretaker government to bring the role of the tax policy under the ambit of the Ministry of Planning and to include taxpayers in the proposed Policy Board of the tax machinery’s restructuring plan. In this regard, the PBC submitted recommendations on the FBR’s restructuring on Sunday. The restructuring plans proposed to retain the policy role within the Finance Ministry, but the deficit-bridging measures will continue to influence policies.  The PBC therefore suggested that the policy role be under the ambit of the Ministry of Planning to align fiscal policy with long-term industrial and trading policies within the framework of 5-year plans. The PBC suggested that separating fiscal policy from tax collection has been a fundamental element of PBC’s advocacy. In the present structure, which combines the two roles, often knee-jerk, short-term, revenue-seeking changes are made which undermine investor confidence. Worse still, these revenue-seeking measures target those that are already disproportionately burdened, thwarting the growth of business and the economy. There are plans to deploy AI and technology to broaden the tax base. However, this will require a significant transformation of talent. PBC strongly recommended that the taxpayers (stakeholders) should be included in the proposed Policy Board under the restructuring plan of the Federal Board of Revenue (FBR). According to the recommendations of the PBC on the FBR’s restructuring on Sunday, the PBC has noted with concern that the Policy Board will not have taxpayer representation and that the primary goal of policies will be to raise tax revenues. The PBC strongly believed that policies should drive the growth of business, from which higher taxes can flow to the exchequer. Thus, wealth creation, capital accumulation, consolidation through the formation of groups, investment, employment, exports, import substitution, and building resilience to climate change should be the drivers of tax policies and the goal of the Policy Board. The inclusion of taxpayer representation on the Policy Board will enrich its output. Taxpayers are important stakeholders that should not be ignored. Furthermore, tax targets should encourage a broadening of the tax base instead of merely the total revenue raised. The policy measures to support the long-term growth of business, economy, and tax revenue: