PM Shehbaz Orders Timely Completion of FBR Reforms, Third-Party Audits
ISLAMABAD, PAKISTAN — WEB DESK: Prime Minister Shehbaz Sharif on Friday directed authorities to complete all ongoing Federal Board of Revenue (FBR) reform measures within their prescribed timelines, calling for independent third-party audits as Pakistan accelerates the digital transformation of its tax and customs systems.
The directives were issued during a weekly review meeting on FBR reforms in Islamabad, where officials briefed the prime minister on restructuring at Pakistan Revenue Automation Limited (PRAL), tax-system digitisation, customs reforms and measures to combat smuggling.
Shehbaz said digitisation, production monitoring and automation were among the main pillars of the government’s FBR reform programme.
He also ordered authorities to intensify action against tax evasion, smuggling and illegal businesses, while ensuring independent scrutiny of reform initiatives to improve transparency, effectiveness and sustainability.
IRIS 3.0 and Central Data Hub Under Development
Officials told the meeting that work was progressing in phases on IRIS 3.0, a new tax operating model and a Central Data Hub, designed to create a more modern, integrated and data-driven tax administration.
International consultants have been engaged to work on the design of IRIS 3.0, according to the briefing.
New senior leadership appointments have also been made at PRAL across technology, data security, operations and tax-domain functions.
Under IRIS 3.0, authorities plan to improve the efficiency of the tax system, pilot the concept of automated taxation and eventually use artificial intelligence and machine learning to strengthen revenue collection.
The plans represent part of a broader government effort to reduce human discretion in tax administration and make greater use of digital data for compliance and enforcement.
Faceless Customs Assessment Shows Revenue Increase
The meeting was also briefed on the government’s faceless customs assessment system, another major element of the reform programme.
Officials said average revenue collected per goods declaration increased by 12% between January and June 2026 following the introduction of faceless assessment.
According to the government’s assessment, the system has also improved authorities’ ability to detect and monitor irregularities in imports.
Recruitment of 280 goods evaluators for the customs assessment system is in its final stages.
Shehbaz welcomed the recruitment of evaluators with strong professional reputations and praised the FBR chairman and his team for their work.
Central Assessment Unit Targeted for December
Authorities are meanwhile working to establish a Central Assessment Unit in Islamabad to further integrate customs assessments.
The government plans to make an interim version of the unit operational by December 31, 2026, while a fully integrated facility is targeted to begin operations in a new complex by June 2027.
These deadlines are significant because the prime minister’s latest instructions specifically require FBR reform projects to remain within their prescribed implementation schedules.
Digital Invoicing Jumps Above Rs2.5 Trillion
The meeting was also presented with figures showing rapid growth in Pakistan’s digital invoicing system.
Officials said transactions processed through digital invoicing stood at Rs236 billion in July 2025.
By July 2026, that figure had increased to more than Rs2.5 trillion.
The government has now set a target of taking digital invoicing transactions to Rs4 trillion by December 2026.
If measured directly against the reported July figures, the rise from Rs236 billion to more than Rs2.5 trillion represents an increase of more than tenfold in transaction value.
The expansion of digital invoicing is intended to improve documentation of economic activity, reduce opportunities for tax evasion and give authorities better visibility into transactions.
Government Steps Up Anti-Smuggling Drive
Officials also briefed the prime minister on technology-based measures being introduced to tackle illegal movement and sale of petroleum products.
These include GIS tagging of legal petrol stations, GPS tracking of petroleum products, integration of oil marketing companies’ ERP systems with tracking mechanisms and a central tracking application for law-enforcement agencies.
The meeting was told that the Rahguzar app had contributed to action against around 2,500 illegal petrol pumps, which authorities said had been shut down and subjected to legal proceedings.
Work is continuing on digital monitoring of petroleum-product sales and related anti-smuggling initiatives.
FBR Reform Part of Wider Revenue Strategy
Pakistan has been pursuing extensive tax-administration reforms aimed at widening the documented economy, improving compliance and increasing the country’s tax-to-GDP ratio.
The broader reform roadmap includes the FBR Transformation Plan, establishment of a separate Tax Policy Office and stronger compliance-risk management, with parts of the agenda also linked to Pakistan’s economic reform commitments under its IMF programme.
Recent measures have also targeted faster sales-tax registration. On August 25, FBR issued an order requiring qualifying low-risk sales-tax registration applications with complete documentation to be processed within prescribed accelerated timelines.
The government’s challenge will be translating these technological and administrative changes into sustained improvements in revenue collection, taxpayer services and compliance while reducing opportunities for corruption and discretionary decision-making.
At Friday’s meeting, Shehbaz reiterated that the purpose of the reforms was to create a modern and effective tax system, increase revenue collection and strengthen action against smuggling.
He ordered authorities to accelerate implementation while ensuring that every reform initiative is completed according to its established deadline.
