Overlapping functions: number of FBR members may be reduced to eight

The government may reduce the number of FBR Members from 12 to eight with a view to removing overlapping of functions and reducing expenditure of the Board under the austerity measures.
Sources told Business Recorder here on Thursday that the Ministry of Finance and the FBR have discussed the idea of reducing the number of FBR Members reporting to the FBR Chairman keeping in view the experience of a large number of members simultaneously dealing with the enforcement issues.
A proposal is under study to reduce the overall number of members from 12 to eight. The rationale behind the proposal is to remove overlapping of function among FBR Member Domestic Operations and FBR Member Enforcement and Accounting. Under the new organisational structure of the Inland Revenue, there should be a single FBR Member Inland Revenue to deal with all domestic taxes.
At the same time, the reduction in the number of members would be instrumental in checking expenditure as well. If this proposal is accepted by the policymakers, the timeframe would be finalised for implementation of the decision. The FBR has to reassign the functions and responsibilities of the revised posts to the members, if necessary.
In case the proposal is finalised, the FBR would abolish the slots of FBR Member Domestic Operations North and FBR Member Domestic Operations South whereas the post of FBR Member Direct Tax Policy and FBR Member Indirect Tax Policy would be merged into a single post of FBR Member Inland Revenue. Similarly, the posts of The FBR Member Customs Operations and FBR Member Customs Policy may be merged into a single position of FBR Member Customs.
Under the present set-up, 12 Members who have to directly report to the FBR Chairman, included FBR Member Enforcement and Accounting, FBR Member Direct Tax Policy, FBR Member Indirect Tax Policy, FBR Member Customs Operations, FBR Member Customs Policy, FBR Member Domestic Operations North, FBR Member Domestic Operations South, FBR Member Taxpayer's Audit, FBR Member Legal, FBR Member Administration, FBR Member Strategic Planning and Statistics along with FBR Member Taxpayer Education and Facilitation.
If such a proposal is being implemented, the new setup could cover FBR Member Inland Revenue, FBR Member Enforcement and Accounting FBR Member Customs, FBR Member Taxpayer Audit, FBR Member Legal FBR Member Administration, FBR Member Strategic Planning and Statistics and FBR Member Taxpayer Education and Facilitation. There would be no change in the number of support FBR members.
Sources said that the major change under the proposed organisational structure of the FBR is the abolition of the posts of FBR Member Domestic Operations North and FBR Member Domestic Operations South. If such a proposal is implemented, the FBR Member Enforcement and Accounting would solely deal with the issue of enforcement and compliance at the level of field formations.
Under the new organisational structure of Inland Revenue, all domestic taxes including income tax, sales tax and federal excise duty are covered under Inland Revenue. If any change has been made in the existing structure, FBR Member Direct Tax Policy and FBR Member Indirect Tax Policy would be merged into FBR Member Inland Revenue.
If the posts of the Member Customs Operations and FBR Member Customs Policy are merged, only FBR Member Customs would deal with all the customs related matters. When the FBR had appointed 12 members in the past, it was considered to be major change under the restructuring process to separate the policy and operational side to ensure integration between direct and indirect taxes. Any change in the existing structure would reduce the number of Members directly reporting to the FBR Chairman.
The sub-group of income tax of the Tax Reform Co-ordination Group (RCG) had suggested the Ministry of Finance that the existing functional setup may be reviewed to ensure it is consistent with the reform framework. The sub-group acknowledged the need for functional specialisation and the continuation of functional distribution (separation of functions of audit, enforcement and legal).
However, it was proposed that said functional distribution be restricted up to the Additional Commissioner level and not taken to the Commissioner level. The concept of a Member Inland Revenue (IR) should be revived after the merger of taxes, and appointed in place of Member Policy. The group was of the view that posts of Members Operation were redundant and the Chief Commissioners should work under Member IR.
Under the present powers and jurisdictions of FBR Members, FBR Member Direct Policy is responsible for all policy, rules and regulation matters relating to direct taxes and interpretation of direct tax laws. His line of communication to and from field offices will always be through Members Operations, North and South. He deals with all matters relating to direct taxes with international organisations/agencies. He would also perform any other duties assigned by Chairman FBR.
The FBR Member Indirect Taxes Policy is responsible for all policy, rules and regulation matters relating to domestic indirect taxes and interpretation of indirect tax laws. His line of communication to and from field offices will always be through Members Operations, North and South. He is dealing with all matters relating to domestic indirect taxes with international organisations/agencies. He would also perform any other duties assigned by Chairman FBR.
The FBR Member Customs Policy shall be responsible for all policy, rules and regulation matters relating to customs and interpretation of customs laws. His line of communication to and from field offices will always be through Members Customs Operations. He shall deal with all customs matters with international organisations/agencies. He would also perform any other duties assigned by Chairman FBR.
The FBR Member Strategic Planning and Research & Statistics is responsible for formulation of revenue targets and strategic planning for their achievements. He is the Project Director of Tax Administration Reform Project (TARP) and any similar projects in future. He shall perform all responsibilities of former Member Fiscal Research and Statistics (FR&S). He would also perform any other duties assigned by Chairman FBR.
The FBR Member Legal is responsible for preparing legal briefs of tax-evasion prosecution. His other responsibilities shall remain the same as before. He would also perform any other duties assigned by Chairman FBR. The FBR Member Finance and Administration is performing all responsibilities relating to budget and asset management of the FBR. His other responsibilities shall remain the same as before. He would also perform any other duties assigned by Chairman FBR.
The FBR Member Facilitation and Taxpayer Education (FATE) responsibilities are the same as before. He would also perform any other duties assigned by Chairman FBR. The FBR Member Enforcement and Accounting is presently responsible for planning and designing procedures regarding tax returns and tax payments, tax return processing and taxpayer accounts, taxpayer registration matters, control of unregistered taxpayers, control of non-filing and collection of arrears.
His line of communication to and from field offices will always be through Members Operations, North and South. He is also evaluating enforcement activities for all domestic taxes and advise Member Operations North/South accordingly. He is dealing with all matters relating to Public Accounts Committee/Departmental Accounts Committees. Any other duties assigned by Chairman FBR.
The FBR Member Taxpayer Audit is responsible for planning and designing procedures and evaluating tax audits for all domestic taxes. He is also responsible for devising and implementing a National Audit Plan. He shall design case selection criteria to extend audit coverage to all higher risk areas. He shall develop audit methodology to assure audit quality. Any other duties assigned by Chairman FBR.
The FBR Member Customs Operations is responsible for supervising all Customs operations. Chief Collectors North and South will report to Member Customs Operations. He is also monitoring revenue collection and ensure achievement of revenue targets. Any other duties assigned by Chairman FBR.
The FBR Member Domestic Operations (North) is responsible for supervising domestic tax operations of northern field offices. The DGs of RTOs Islamabad, Rawalpindi, Peshawar, Sialkot, Gujranwala, Abbottabad and LTUs Islamabad and Lahore will report to him. He is doing the job of monitoring revenue collection and ensuring achievement of revenue targets by northern field offices. Any other duties assigned by Chairman FBR.
The FBR Member Domestic Operations (South) is responsible for supervising domestic tax operations of southern field offices. The DGs of RTOs ie Karachi, Hyderabad, Sukkur, Multan, Faisalabad, Quetta and LTU Karachi will report to him. He is also monitoring revenue collection and ensuring achievement of revenue targets by southern field offices. Any other duties are assigned by the FBR Chairman.