Sources told Business Recorder here on Tuesday that the issue of tax reforms in the FBR was discussed during the second Steering Committee (SC) meeting of the Trust Fund for Accelerating Growth and Reforms (TAGR) which was held at Economic Affairs Division (EAD).
The meeting was jointly chaired by Secretary EAD and World Bank officials.
On the issue of tax policy and tax administration reform, sources said that the presentation of the WB focussed on the objectives of the pillar and progress in terms of increasing fiscal space, progress has been made including increase in tax receipts, registered tax payers and collection of arrears.
Regarding tax policy, units have been created, capacities strengthened, and recommendations from analytical work adopted.
Operations have also been supported in a number of areas, including audit, tracking and tracing, and process mapping.
Important challenges, however, remained, including the lack of harmonisation of tax code and other regulations, and the need to move faster on implementation of the action plans is drawn up to reform tax administration. Going forward, focus will be on putting in place consistent framework for tax policy
and implementing the IT strategy.
Harmonising federal and provincial tax systems, further attempts to broaden the tax base and improve collection (through e-payments and e-invoicing), and continued strengthening of analytical capacity (through creation of intelligence units) will be the important steps.
The World Bank representative informed that on tax policy, units are created, capacities strengthened and M & E framework is under way with the deliverable of IT-automation and expected impact of increased compliance and minimised interaction with taxpayers.
The secretary EAD reportedly recalled endorsement by the previous SC meeting of: a) the overall TF design, governance, and implementation structure; b) terms of reference (ToRs) of the MDTF Secretariat; c) ToRs of the SC; d) first year pipeline activities; e) transfer of the Punjab Revenue Authority Technical Advisory (TA) to the Taxation pillar of TAGR; f) establishment of a cross-cutting advisory committee to facilitate coordination and information-sharing. He recognised TAGR's effective support to the Economic Growth Reform (EGR) programme at federal and provincial levels.
The Department for International Development (DFID) has contributed GBP30 million to support the reform agenda and the WBG for managing and implementing the Trust Fund.
The World Bank representative underscored the importance of the SC which is mandated to provide strategic guidance to TAGR and concurrently, support a successful economic reform agenda. He noted the need to further strengthen reforms relating to state owned enterprises (SoEs) and stressed the need for consistent efforts to ensure a successful reform programme with TAGR's support.
The representative of DFID acknowledged that the improved pace of work had yielded results, including the unlocking of USD920 million for prior actions. The reallocation of funds from slow moving programmes to others has also steered the TF in the right direction.
The representative also stressed that since the TF is closing in October 2018, it is necessary to expedite Recipient-Executed Trust Funds.
Other development partners were also invited to contribute to the TF.
Copyright Business Recorder, 2017