IMF-Linked Reform: Government Withdraws Key Powers from Federal Board of Revenue (FBR)

In a major policy shift linked to its bailout agreement with the International Monetary Fund (IMF), the Pakistani government has withdrawn significant powers from the Federal Board of Revenue (FBR) and created a separate Tax Policy Office under the Ministry of Finance.
Under the new arrangement, the FBR will focus strictly on tax collection and enforcement, while the newly created policy office will take over tax-policy formulation and oversight. Officials say this structural reform is intended to improve transparency, limit conflicts of interest, and align Pakistan with IMF-mandated governance standards.
The change arrives amid ongoing concerns over revenue shortfalls and delayed reform implementation under the IMF programme. The tax system’s efficiency and the size of the tax base remain central to Islamabad’s reform agenda.
The shift has been met with mixed reactions: some welcome it as a long-needed clean-up of an opaque system, while others caution that managing two separate bodies may complicate coordination unless accompanied by strong oversight.