PM orders comprehensive third-party audit of all FBR projects

Prime Minister Shehbaz Sharif has ordered the Federal Board of Revenue to get all its projects audited through a third party in an effort to enhance transparency and improve operational efficiency. This was decided during a Friday meeting where the prime minister examined the FBR’s performance.

PM Shehbaz said, “Improving FBR performance is going to be the most significant step in determining the country’s economic progress,” and digitization of the FBR is a landmark achievement in the government’s economic reforms. He said that generating higher revenue was an essential step to improve services for citizens and strengthens the social sector.

He also asked for the strengthening of the enforcement system of FBR. He calls it the corner stone of fiscal stability. He appreciated the FBR Transformation Plan and asked the officers to be active participants with taxpayers in welcoming feedback and recommendations from them, while briefing them in his meeting.

He also underscored the need for a drastic approach against smuggling, which he termed to be highly injurious for the economy. Key federal ministers included planning, law, economic affairs, and finance among others, as the meeting involved an all-rounded briefing on the FBR Transformation Plan.

For FY 2023, the FBR reported an increase of 71% in the number of tax return filers, bringing 2.2 million to the total count of 5.3 million, and has fixed September 30, 2024, as the deadline for filing income tax returns for FY24.

FBR collected $33.22 billion in FY23 against the revised target of $32.52 billion. Income tax more than surpassed expectations, but collection through sales tax was inadequate.

During the first two months of the fiscal year, FBR collected Rs1.456 trillion, which is still Rs98 billion lower than the target. The government has ensured inducting a new Extended Fund Facility of $7 billion with the International Monetary Fund (IMF) to increase the tax revenue to 15% of the GDP by widening the tax base and simplifying the tax system.

In the look-ahead policy, the government has promised a rather ambitious target of Rs12.97 trillion in revenue collection for FY25, which translates into a 40% increase over the target for FY24.