INTRODUCTION

The Federal Board of Revenue and its subordinate departments, namely, income tax, customs, central excise and sales tax, administer Pakistans tax system. The constitution empowers the federal government to levy and collect. Taxes on income, other than agricultural income Taxes on capital value of assets, other than taxes on capital gains on immovable property Customs duties on international trade Excise duties, other than on liquor, opium and other narcotics and Taxes on sales and purchase of goods imported, exported, purchased, manufactured or consumed.

HISTORY
The Central Board of Revenue (CBR) was created on April 01, 1924 through enactment of the Central Board of Revenue Act, 1924. In 1944, a full-fledged Revenue Division was created under the Ministry of Finance. After independence, this arrangement continued up to 31st August 1960 when on the recommendations of the Administrative Re-organization Committee, CBR was made an attached department of the Ministry of Finance. In 1974, further changes were made to streamline the organization and its functions. Consequently, the post of Chairman CBR was created with the status of ex-officio Additional Secretary and Secretary Finance was relieved of his duties as exofficio Chairman of the CBR.

VALUES of FBR
Integrity Professionalism Teamwork Courtesy Fairness Transparency Responsiveness

ORGANIZATION STRUCTURE of Federal Board of Revenue (FBR)

FUNCTIONS OF FBR

Formulation and administration of fiscal policies Levy and collection of federal taxes and Quasi-judicial function of hearing of appeals

VISION of FBR
To be modern, Progressive, Effective, autonomous and credible organization for optimizing revenue by providing quality service and promoting compliance with tax and related laws.

MISSION
Enhance the capability of the tax system to collect due taxes through application of modern techniques, providing tax payer assistance and by creating a motivated, satisfied, dedicated and professional workforce.

RESOURCES
Following are the assets in tangible and intangible form owned by Federal Board of Revenue. Services People Finance Facilities SERVICES: Tangible: Quality Control Program Intangible: Service quality assurance philosophy PEOPLE: Tangible: Training Program Contacts and commitments Trained labor in long term employment Effective communication systems Satisfactory salary and benefits agreement Intangible: Technical expertise Leadership Stability Creative input from all employees FINANCE: Tangible: Control Systems Budget and update information and regular intervals Intangibles: Strong financial controller and accounts staff Financial goals Financial planning and skill advisers FACILITIES: Tangible: Modern information technology equipments Adequate space Intangibles: Attractive work environment Efficiency and minimum down-time

EFFECTS ON DEPARTMENTS
Audit division Enforcement division Legal division Tax payer division Information process (IP) division Human resource management division

ORGANIZATION UNIQUENESS
Monopoly in operation No Competitor

NEED FOR CHANGE

The relationship between tax payer and tax collector Element of bribery Slow interaction Wastage of time and resources Obsolete working system Change in Ordinance Changed operation cycle Lack of infrastructure No tax payer facilitation

Identification Of Change
MAJOR CHANGE Universal self assessment scheme Change in inherent attitude Procedural Change Infrastructure Change

PRESENT CULTURE OF FBR

OLD SYSTEM Direct interaction with tax payers. No use of modern technology. No check of dress code. Manual attendance system. Less tax payer facilitation. No education programs for tax payers. No employee training programs and Work-shops. Segregated offices of commissioners and assistant commissioners. Conventional offices of tax collectors and commissioners. No grievance report system for mal-administration from employees. Conventional working methodology and old mind sets of employees. NEW SYSTEM Direct and indirect interaction with tax payers. Use of sophisticated MIS system.

Professional dress code is implemented. Electronic attendance system introduced. Tax payer facilitation is the first obligation. Tax payers are educated and assisted through seminars and work- shops. Employees are trained to use modern technology and to tackle with tax payers problems. Commissioners and assistant commissioners at one place. Purpose built tax collection and tax payer facilitation offices. Grievance cell is created to complaint directly to chairman FBR. Desire to keep pace with changing world is observed

Final Report on FEDRAL BOARD OF REVENUE (FBR) (Part 2)

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SWOT ANALYSIS of FBR

STRENGTHS
Monopoly Power of assessing income Direct and Indirect tax collection Protection of job Authority throughout the country International standards

WEAKNESSES
Old mind set Vague future Slow Learning Weak salary structure Lack of social security Decreased authorities of employees

No monetary benefits

OPPORTUNITIES
Significant increase in overall revenue Building confidence among tax payers Timely collection of taxes, customs and duties.

THREATS
Technological change Policies of IMF and World Bank Cyber attacks

STRATEGIES FOR CHANGE

Division and unit level division of work Segregated functions of Income Tax, Sales Tax, Customs and Duties. Increased incentives Introduction of information technology Dedicated workforce Tax Payer education Employee education and seminars

PLAN TO FACILITATE CHANGE

PLAN FOR CHANGE FACILITATION AND TAXPAYERS EDUCATION WING (FATE)

FUNTIONS OF FATE
To ensure flow of information to the stake holders that is timely, relevant and of high quality. To receive the information and queries from the taxpayers regarding procedural and technical difficulties To promote cultural change in FBR as tax officials Preparation and publishing brochures, guides, and material To simplify tax return forms and other forms for the facilitation of tax payers. To maintain a user friendly website providing maximum information Arranging and organizing tax awareness seminars, employee workshops and question answer sessions. To assist administration wing in establishing about 65 Tax Facilitation Centers (TFCs) all over the country. Establishing information spots, mobile information units for facilitation of the taxpayers. Liaison with the tax payers representatives such as chamber of commerce, trade bodies through awareness seminars, workshops etc. Responding to the queries of tax payers and general public

MEASRUES FOR BRINGING A CHANGE

Furnished building for office Acquisition of IT tools and accessories Development of web site

FURTHER MEASURES IN CHANGE PLAN

Representation to the Chairman FBR Tax Awareness seminars Employee workshops Capacity Building Courses Call Center/ Complaint Handling System Brochures and Leaflets Website Taxpayers Facilitation Centers

IMPLEMENTATION OF CHANGE
Monitoring authority Performance measures Success symbol

EVALUATION OF CHANGE
Budgets and targets are achieved or not Taxpayer facilitation Taxpayer and stakeholder satisfaction Disposal of cases Reopen of cases Rectification in cases

RESISTANCE
Fear of unnecessary latitude to taxpayers Fear of losing authority Fear of losing monetary rewards Fear of vague future

Internship Report On M/s Naveed Zafar Husain Jaffery & Co. Chartered Accountants

Virtual University of Pakistan

Evaluation Sheet for Internship Report Spring 2010
FINI619: Internship Report (Finance) Credit Hours: 3

Name of Student: Students ID: Supervisor:

Sajid Naveed Khan MC080402910

Evaluation Criteria Written Work Status (Internship Report) Presentation & Viva Voce Final Result

Result Pass

Technology Dependence Fear of losing stakes Fear of not having the capacity to comply with new technology Lack of belief that revenue will not increase. Employees believe that change was unnecessary

LEVEL OF RESISTANCE
Level of resistance was high in lower level staff because they were about get out of their comfort zones and there were many fears in their minds that they will not be able to cope up with the changing needs of the organization

TYPE OF RESISTORS

MEASURES TO OVERCOME RESISTANCE

A proper check system should be developed to monitor the tax submission activities of tax payers so that they cannot understate their tax liability. Employees should be empowered to take volunteer decision but with accountability check, which will help to pursue the main objective of the organization. Monitory rewards, perks and other benefits should be offered on performing up to the standards set by the organization. Complete career path should be designed to motivate employees. Technology alternatives and back-up systems should be developed that can be used in the case of uncertainty. Regular employee training and skill improvement programs should be organized to assist employees. Work-shops and seminars should be organized to celebrate best performances which will help employees to work hard consistently to achieve goals and objectives.

CRITICAL ANALYSIS
Universal Self Assessment Scheme Officers are not allocated at proper places There is no sign of career planning Motivation level in employees is low Mind set of high officials is not changed. There is an inefficient use of technology There is no improvement due to no competition Discrimination factor is generated due to jurisdiction flaw. Apparently cosmetic level change

RECOMMENDATIONS
Due to self assessment scheme extra latitude has been given to taxpayers Proper allocation of duties and responsibilities Proper career path should be clearly defined to motivate employees More perks, incentives and monetary benefits should be awarded Seminars should be arranged to educate and train high officials Periodically monitoring employees who are directly interacting with technology

Inter- department competition programs The commissioner of tax collection should not be told about the identity of their taxpayers

BENEFITS TO WHOM
Tax payer Government