On October 6th 2020, Prime Minister Imran Khan appointed former Finance Secretary and prominent economist Dr. Waqar Masood as his Special Assistant on Revenue, and gave him the daunting task of reforming the Federal Bureau of Revenue (FBR). Dr. Masood – who has been previously served the state under three different governments – now faces perhaps the biggest challenge of his career.

Waqar Masood has been clear about what needs to be done to right the course of the labyrinthian institution. A quick glance at his views in various publications present a cogent litany of problems and their respective solutions.

The most prominent among these is ensuring the tax net is spread wider, and powerful interest groups do not manage to slip through the cracks. FBR collection rates – despite ambitious targets and a public awareness campaign led by Prime Minister Imran Khan himself – have been inconsistent over the past few quarters; bringing efficiency and responsibility back into the tax body is essential if the reforms are to be successful.

FBR, like most other large organizations set in their ways, will be resistant to change, especially once we consider the lucrative business of misleading tax authorities with the help of rouge officials. Waqar Masood would need to crackdown on such practices, can he succeed where other have failed?

Once the operation of the department has been improved, the puzzle of fixing the tax regime itself must be solved.

In an article in an English language daily on January 22, 2020, titled “Real and monetary”, Waqar Masood writes: ” Besides the impact of devaluation, additional taxation has broken the back of imports. New taxes imposed include ‘additional import duty’ and ‘regulatory duty’. Furthermore, for the purpose of levy of duty and sales tax the value of imported goods is taken at the retail price. All these measures have led to a significant increase in the cost of imports.”

Uncertain tax regimes, ill-though out levies for quick revenue, and unnecessarily generous concessions have created a patchwork of tax liabilities and responsibilities that have made ‘ease of business’ a foreign concept in Pakistan. Reforming and simplifying these rules is the primary goal of any FBR reform plan.

COVID-19, and the vast shocks to the economy it has brought, is another tough challenge to negotiate. Can FBR get back on track, when uncertainty is rife and businesses are struggling to keep themselves afloat.

Given his vast experience and credentials, many believe that Dr. Waqar Masood would be up for this daunting task. A PhD in Economics form Boston University Massachusetts, and Masters in Economics and LLB from Karachi University, Dr Masood has a wide-ranging experience of working with both public and private sectors, including Secretary Economic Affairs Division, Secretary Petroleum & Natural Resources and Secretary Textile Industry. He also has the experience of teaching macroeconomics at graduate level at Pakistan Institute of Development Economics (PIDE).

The coming months – with a second wave of COVID-19 looming in the wings – would be crucial for both Mr Masood and FBR.

The story was filed by the News Desk.
The Desk can be reached at info@thecorrespondent.com.pk.

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