‘NBR leadership structure major barrier to reform’

NN Online:

The Advisory Committee – tasked with proposing reforms for the National Board of Revenue (NBR) – has identified the dual role of the Internal Resources Division (IRD) secretary as a significant obstacle to the efficiency of the NBR.

The same person serves as the IRD secretary and the NBR chairman, complicating the NBR’s effective performance, the committee said in its interim report recently submitted to the government.

On October 9 last year, the interim government formed the five-member Advisory Committee through a gazette notification.

The committee comprises two former NBR chairmen-Muhammad Abdul Mazid and Dr Nasiruddin Ahmed-and three former NBR members-M Delowar Hossain, Farid Uddin, and Aminur Rahman.

As per the gazette, the committee’s responsibilities include advising on fiscal policy and revenue administration reforms, assessing the NBR’s institutional capacity and recommending modernisation measures.

It also focuses on promoting integrity, enhancing governance and improving citizen and stakeholder engagement regarding revenue reforms.

The interim mentioned that the dual role of the IRD Secretary and NBR Chairman, created to address administrative complexities, has hindered effective governance.

Established in 1979 under a Secretary’s leadership, the IRD was intended to oversee tax policy, tax administration and taxpayer services as outlined in the Rules of Business, 1976.

But the report highlighted that the overlapping responsibilities have resulted in inefficiencies.

To resolve these issues and create a transparent, development-friendly revenue framework, it called for amendments to Presidential Order No. 76 of 1972, proposing the restructuring of the NBR and IRD.

This demand is also being voiced by various stakeholders including development partners, the report added.

In this context, the Advisory Committee after reviewing the relevant rules and regulations in this regard with a holistic view, proposals and suggestions from the relevant stakeholders, and following the international best practices, proposed that two activities of the National Board of Revenue- formulating revenue policy and revenue collection by implementing the policy.

The committee recommended separating the functions of policy formulation and revenue collection by establishing an independent “Revenue Commission” with a department status.

While the commission would focus on policy development, the restructured NBR would concentrate on policy implementation and revenue collection, it said.

To make the proposed reforms effective, the report said, the organisational structure of both the proposed institutions will be upgraded by changing both horizontally and vertically.