| Islamabad: The International Monetary Fund (IMF) has advised the Federal Board of Revenue (FBR) to eliminate the special tax regime for the construction sector and integrate it into the standard income tax framework, as claimed in a news source on March 15.
Read: FBR raises sales tax for high-value cars
According to the details, this recommendation came during discussions between the IMF team and FBR officials regarding the second review of the Stand-by Arrangement (SBA). The IMF also proposed abolishing the FBR’s discretionary power to grant tax incentives and suggested that any future incentives be time-bound and subject to cost-benefit analysis.
Read: FBR directs timely sales tax refunds post billion rupees disbursement
Additionally, the IMF recommended reviewing and potentially adjusting eligibility criteria for tax credits related to charitable donations and certain individuals. It also urged the expansion of the National Tax Council’s role to include the harmonisation of tax rates and the enforcement of provincial tax laws. Furthermore, the IMF suggested the establishment of a Tax Policy Unit within the Ministry of Finance, Revenue, and Economic Affairs, along with protocols for data exchange between the FBR and other agencies. |
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