Federal Board of Revenue is expected to collect a whopping 13,500 billion rupees in tax collection in the year 2025.
Federal Board of Revenue collected Rs. 9,306 billion in taxes for the fiscal year 2023-2024. This was slightly higher than the target of Rs. 9,252 billion.
Is FBR Justified in Procuring 1,010 Cars for its Officers? Well, we heard FBR bashing from the day one as soon as news of procuring 1,010 Cars for FBR Officers was in the media. Whether it was the conventional or social media, everyone was talking about it.
“We’re a poor country, why do our officers need such luxurious vehicles for their duty?” one social media clip called out the FBR for misusing the money. The conventional media also titled it as a scandalous purchase process. The case was further highlighted when Senator Faisal Vawda raised questions over the procurement process during a Senate Panel’s meeting on January 22, 2025. He even claims to receive death threats from FBR officials for raising the issue. Thus, he was able to turn the public opinion against the procurement.
Amid all of this debate, the actual issue remains intact: Is FBR Justified in Procuring 1,010 Cars for its Officers?
The most important consideration is the previous procurement of vehicles by the Federal Board of Revenue. It may be shocking that such a large scale procurement was only made during former military ruler General Pervez Musharraf’s rule. Well, the data of annual procurement plans show that FBR did not procure vehicles for its officers for over 20 years.
Let’s Review the Role of FBR
While we may not have a liking for FBR. Of course, it tends to take away the hard earned money from the taxpayers. Yet, it may be astonishing that the agency does not use these funds directly. Rather, all the funds it collects are deposited in the national exchequer. It is simply an organ to identify, audit, collect and deposit the tax money in the national exchequer.
To begin with, FBR’s Chart of Functions assigns several roles to its officers. “To check, supervise, ascertain, monitor, reconcile and properly enforce, in whole of Pakistan, the Withholding regime and other relevant provisions of the Income Tax Ordinance, 2001 and Sales Tax of 1990,” is one of the functions. A detailed review explains extensive role in every aspects of taxation system of Pakistan.
Moreover, Pakistan’s budget for 2024-25 proposed collection of rupees 12.97 trillion for the FY25. Yet, the FBR Chairman claimed that FBR is targeting a collection of Rs. 13,500 billion or 13.5 trillion for the FY25. While he has made the claim, the actual burden rests on the field teams. FBR Officials are required to collect taxes from different areas through multiple field formations. It requires rigorous field work with visits, assessments, audits, sealing and de-sealing of shops, business hubs, eateries and officers across different areas.
Status of Cars at FBR
With such a massive role, the organization has a pool of limited official vehicles for its officers. An FBR official claims that the official vehicles are available for Chief Commissioners and Members of FBR only. All other officers including the Commissioners, Additional Commissioners, Deputy Commissioners and the Assistant Commissioners do not have an official vehicle to perform their duties.
Imagine an Assistant Commissioner visiting a business premises to audit or review or seal the location on an Uber Taxi. Surely, this isn’t an appropriate scenario. So, should they keep sitting in the office and wait for a vehicle which may be available once a week for any Assistant Commissioner?
Issue of Procuring 1,010 Cars for FBR Officers
On 13 January, the Federal Board of Revenue initiated the procurement of 1,010 new vehicles, each with an engine capacity of 1,200cc, intended for tax officers. This move sparked significant debate and scrutiny from various quarters, including legislative bodies and the public.
A Senate panel has raised concerns regarding this procurement, advocating for the cancellation of the contract. The primary objections center on the procurement process and the necessity of such a large fleet. Senator Faisal Vawda highlighted issues related to the selection of the vehicle supplier, pointing out that Honda Atlas was awarded the contract without a competitive bidding process. He noted that Indus Motors had offered a lower price and a more extended warranty period, yet was overlooked in favor of Honda Atlas. These concerns have led the committee to consider communicating with higher authorities, including the Prime Minister and the Finance Minister, to halt the purchase.
In response to the criticisms, the FBR has defended its decision by emphasizing the operational needs of the tax department. According to Freedoon Sheikh, FBR’s Chief Administrator, the new vehicles are essential for locating non-filers and conducting physical verifications of tax returns submitted online. He explained that the choice of Honda Atlas was influenced by the engine capacity restrictions, as the cabinet had approved the purchase of vehicles up to 1,300cc. This limitation excluded options like the 1,328cc Toyota Yaris offered by Indus Motors.
Challenging the Public Perception
The procurement has drawn public attention, with debates focusing on the fiscal responsibility of such an expenditure. Critics argue that allocating approximately Rs6 billion for new vehicles may not be prudent, especially considering the country’s economic challenges. They suggest that the funds could be better utilized in other critical areas, such as healthcare or education. It has also ignited a multifaceted debate involving procurement transparency, fiscal responsibility, and the operational needs of the tax authority. Thus, the government has bowed down to the public pressure without balancing the considerations of impact on the tax collection.
Is FBR Justified in Procuring 1,010 Cars for its Officers?
The entire discussion explains that the FBR bashing wasn’t correct with such a massive role in tax collection in Pakistan. While an officer of lower scales in district administration of any province enjoys much better mobility. It is imperative that the FBR officers are allowed, if not similar, at least some sort of mobility to ensure they can do their jobs.
