ISLAMABAD: On Tuesday, Federal Board of Revenue (FBR) Chairman Rashid Langrial acknowledged that corruption is still a problem within the FBR. During a briefing to the National Assembly’s Standing Committee on Finance, Langrial admitted that corrupt practices continue to affect the department.
Langrial explained that recent changes in tax laws are aimed at expanding the tax base, focusing on higher-income individuals and businesses involved in large transactions. He said the new laws give FBR officers more authority to tackle black money and tax evasion.
One of the significant measures in the new laws is to restrict non-tax filers from engaging in certain economic activities. Non-filers will not be able to buy property, cars, or invest in the formal economy. This is part of the government’s effort to reduce the informal economy and encourage more people to file taxes.
Langrial also mentioned that the cabinet has been given the authority to hire auditors to strengthen tax collection processes. A detailed review of the proposed tax reforms will be conducted before any final decisions are made.
Finance Minister of State, Ali Pervez Malik, emphasized the importance of addressing the issues in the tourism sector and curbing vehicle purchases made with black money for the country’s economic sustainability.
Despite these efforts, Langrial admitted that tax revenues haven’t increased in line with inflation and economic growth. In fact, tax revenues in 2024 were at the same level as they were in 2008, which highlights the challenges faced by the system.
The FBR has also raised income and sales taxes, which have affected salaried individuals. The Chairman of the Standing Committee expressed concerns that these reforms might create more problems for the public instead of solving them, especially in light of the ongoing foreign exchange shortages.
Hina Rabbani Khar, a member of the Committee, criticized the corruption in the FBR and stressed the importance of making the tax system more transparent. She argued that no one should have the power to block people’s bank accounts without proper oversight.