Karachi, May 2, 2024 – A delegation from the Asian Development Bank (ADB) met with the leadership of the Federal Board of Revenue (FBR) on Thursday to discuss the progress of the Domestic Resource Mobilization Program (DRM).
The program is funded by the ADB and aims to improve tax collection and administration in Pakistan.
The ADB mission was led by Tariq Niazi, Senior Director from ADB’s Manila headquarters. Other members included Laisiasa Tora (Senior Public Sector Management Specialist), Ms. Sana Masood (Economist), and Ms. Farzana Noshab (Economist). Representing the FBR were Mir Badshah Khan Wazir (Member, IR Operations), Ardsher Salim Tariq (Member, Reforms and Modernization), Qasim Raza (Member, IT), Karamatullah Chaudhry (Member, Digital Initiative), and Arbab Muhammad Tariq (Member, Legal-IR).
The discussions focused on the implementation of structural and policy reforms outlined in the DRM program. The ADB delegation expressed satisfaction with the progress made so far, particularly with the successful completion of Sub-program I. This initial phase focused on laying the groundwork for improved policies, laws, and institutional capacity for the FBR.
FBR’s dedication to the program resulted in the disbursement of $300 million by the ADB to the Pakistani government in December 2023. Sub-program II, which builds upon the initial reforms, is expected to be completed by the end of 2024. Its aim is to ensure the full implementation and operationalization of the program’s objectives.
The FBR team also briefed the ADB delegation on its digitalization initiatives. These efforts, aligned with the Prime Minister’s vision of a Digital Tax Administration, aim to automate processes and promote a digital economy. FBR believes that these initiatives will not only reduce compliance costs for taxpayers but also document the economy, expand the tax base, and generate sustainable revenue growth.
A key aspect of the digitalization plan involves collaboration with Karandaaz, a development finance institution focused on financial inclusion. This collaboration will focus on developing a comprehensive digital strategy for the FBR, encompassing all aspects of digital transformation and its implementation.
The meeting also explored the contours of a potential Digital Tax Administration Project for the FBR with ADB support. The ADB team expressed keen interest in this proposal, and both parties agreed to explore ways to strengthen their collaboration in support of this project.
The successful implementation of the DRM program is expected to have a significant impact on Pakistan’s public finances. By improving tax collection and administration, the government will be better equipped to invest in essential public services and infrastructure development. The digitalization initiatives undertaken by the FBR further aim to streamline tax processes and promote transparency, ultimately creating a more taxpayer-friendly environment.
