New revenue mobilization project: World Bank mission initiates meetings with FBR officials

A World Bank mission has initiated meetings with the Federal Board of Revenue high-ups for launching a new revenue mobilization project for continuation of tax reforms to raise revenue collection by improving effectiveness, accountability and transparency of tax machinery through institutional changes in the FBR.
Sources told Business Recorder on Monday that the WB missions comprising IT experts has arrived in Pakistan on July 4, 2012 and would continue meetings with the tax authorities, FBR Members and IT Departments till July 14, 2012. The mission comprises team members including Jose Lopez Caliz, lead economist; Saadia Refaqat, economist Eduardo Talero, E-Governance consultant and Shabnam Naz programme assistant.
The WB-funded Tax Administration Reform Project (TARP) was closed on December 31, 2011 and Revenue Mobilization Project would be a new project for the FBR for continuation of tax machinery reforms. The new project aims at improving Tax Policy and revenue forecasting; strengthening the core functions of tax administration to support a performance-based management and enhancing accountability and transparency of tax administration.
The present WB mission is reviewing the reforms which were not completed under the TARP and terms of reference (ToRs), list of activities, timetable, costing etc of the new program would be finalised on the conclusion of the meetings between the WB and the FBR.
During meetings with the FBR, WB mission met FBR Member Sardar Ameen and Shafiq Mohammad head of the Project Management Unit (PMU) to overview the FBR's IT Systems. The WB team will also visit the Pakistan Revenue Automation Limited (PRAL). The WB team would also meet Inland Revenue IT Team and Sales Tax Computer Wing. Besides, the WB experts would also meet Customs IT Team and officials of the Large Taxpayers Unit (LTU). Some important objectives of the project included moving towards fully Integrated Tax Management System (ITMS) to support a modem performance-based and coordinated tax administration and ensure the sustainability of reforms already made under Tax Administration Reform Project (TARP). Accordingly, a Revenue Mobilization Program with the World Bank is being planned keeping in mind important aspects that require the continuity of tax reform in a developing country like Pakistan.
The broad objectives of the program are to raise tax revenue by improving the effectiveness, accountability and transparency of tax administration through institutional changes. The project preparation facility (PPF) will assist the Government of Pakistan (GOP) to finance expenses related to the preparation of a proposed Revenue Mobilization Project.
Sources said that overall objective of the project is to consolidate the revenue mobilization reform initiated under the support of the Tax Administration Reform Project (TARP). Such reform aimed at building a modern tax system and an effective tax administration that facilitates and improves tax compliance with tax laws. Under a performance-based strategic framework, FBR would like to use the new project to raise tax revenue by improving the effectiveness, accountability and transparency of tax administration through institutional changes that favour a performance-based management.
The project preparation facility (PPF) aims at supporting the strategic redefinition of the Core Business Domain Team, a central activity proposed by PRAL and FBR official, new users' surveys and training (including the one focused on senior management), sources said. A possible list of outputs follows: (1) dissemination of FBR Strategic Reform Program; (ii) reduction in the gap between FBR (gross or net) revenue collection as a percentage of tax revenue targets (income and sales tax); (iii) increase in FBR total tax collection./GDP (annual); (iv) establishment of the M&E unit within the strategic planning office, and approval and dissemination of the reviewed KPEs; (v) improved perception by taxpayers based on FBR survey results; (vi) decrease in stop-filers as percentage of registered active taxpayers; (vii) increase in the number of risk-based tax audits; (viii) increased number of business registered taxpayers; and (ix) completion of the review of the ITMS and certified training of senior management.