ISLAMABAD: Prime Minister Shehbaz Sharif has asked the Federal Board of Revenue (FBR) to arrange an independent third-party audit of the tax reforms currently being implemented in the country.

The direction was given during a meeting chaired by the prime minister to review progress on reforms within the FBR. He stressed that the reform process must remain transparent, effective and capable of producing sustainable improvements in the tax system.

According to the information shared during the meeting, the government is focusing on digitalisation, production monitoring and automated tax-related systems as major components of the ongoing reforms.

The prime minister directed the relevant authorities to complete the reform measures within the prescribed timelines. He also called for stronger action against tax evasion, smuggling and unlawful business activities.

Mr Sharif said the reforms should lead to a stronger and more modern tax administration, improve the government’s revenue collection and help eliminate smuggling.

Progress on FBR Digital Reforms

Officials briefed the meeting about several initiatives being undertaken to restructure and modernise the FBR. The discussion included the restructuring of Pakistan Revenue Automation Limited (PRAL), expansion of digital systems and measures aimed at controlling smuggling.

The meeting was also informed about ongoing work on IRIS 3.0, which is being developed as part of a new operating model for the tax system. A central data hub is also being developed to bring tax information together and support a more integrated, data-based system.

International consultants have reportedly been engaged to assist in designing IRIS 3.0.

Move Towards Automated Taxation

Officials further explained that work was progressing on a project under IRIS 3.0 that is intended to improve the efficiency of tax administration. The project includes plans to pilot auto-taxation and gradually introduce technologies such as artificial intelligence and machine learning.

The government expects these technological measures to improve the collection and management of tax revenue while making the overall tax system more efficient and data-driven.

The prime minister directed the concerned authorities to maintain the pace of reform and ensure that the announced measures are implemented within the agreed timeframe.