PBC against finance ministry\'s tax policy role

Although the Pakistan Business Council (PBC) has openly welcomed the government’s plans to split the Federal Board of Revenue (FBR) into two entities, it raises concerns over the proposal of keeping the policy-making department in the Ministry of Finance. In a letter to Caretaker Minister for Finance and Revenue Dr Shamshad Akhtar, PBC Chief Executive Ehsan Malik wrote “the plans you shared propose to retain the (FBR’s) policy role within the finance ministry. Our concern with this is that (revenue) deficit-bridging measures will continue to influence policies.” “We, therefore, suggest that the policy role be under the ambit of the Ministry of Planning to align fiscal policy with long-term industrial and trade policies within the framework of five-year plans.” The separation of fiscal policy from tax collection has been a fundamental element of the council’s advocacy work. In the present structure, which combines the two roles, often knee-jerk, short-term and revenue-seeking changes are made, which undermine investor confidence.