Govt's new tax model to reduce discretion, boost transparency

July 27, 2026 (MLN): The government is rolling out a New Tax Operating Model (NTOM) that shifts Pakistan's tax administration from an officer-driven system to a data-led, technology-enabled and faceless setup, Advisor to the Finance Minister Khurram Schehzad said, outlining the reform alongside FY2026-27 budget priorities at the National Tax Seminar.

Khurram Schehzad was addressing the four-day seminar jointly organized by the Pakistan Tax Bar Association (PTBA) and the Lahore Tax Bar Association (LTBA), attended by PTBA President Ehsan-ul-Haq Sheikh, LTBA President Rana Saqib Munir, PTBA Patron and Tax Bar Academy Chairman Abdul Qadir Memon, Appellate Tribunal Inland Revenue member Zahoor Ahmed as guest of honour, and economist Dr Nadeem Ul Haque as keynote speaker, along with senior tax professionals, legal practitioners and chartered accountants from across the country.

Khurram Schehzad said Pakistan had made significant progress restoring macroeconomic stability through prudent fiscal management and structural reforms, with improved fiscal discipline, rebuilt external buffers, stronger debt management and restored investor confidence helping the country move from stabilization toward sustainable, private sector-led growth.

He said these gains were increasingly reflected in improved sovereign credit ratings, successful IMF programme reviews, renewed access to international capital markets and growing investor confidence.

On the FY27 budget, he described it as balanced and pro-growth, supporting investment, exports, industrial development and employment while maintaining fiscal discipline.

He said it provides relief to the salaried class, measures to boost business competitiveness and support exporters, tariff reforms, and steps to widen the tax base rather than burden existing compliant taxpayers further, according to a press release issued.

He also pointed to the government's broader reform agenda spanning tax administration, public debt management, privatization, state-owned enterprises, pension reforms, energy sector reforms, Digital Pakistan initiatives, capital market development and access to finance, saying these were strengthening institutions and improving competitiveness.

On the NTOM specifically, Khurram Schehzad said the reform separates audit, assessment and field operations into specialized functions while using digital technologies, centralized data analytics and risk-based compliance to reduce discretion, minimize physical interaction and improve transparency and consistency.

He said compliant taxpayers would see simpler, more predictable services, while enforcement would increasingly target evasion through data rather than discretionary action.

He acknowledged the constructive role of tax bar associations and practitioners, calling continued stakeholder engagement central to the reform's success.

The seminar also featured technical sessions on provincial sales tax, FY2026-27 budget tax measures, tax policy, faceless administration and digitalization, with Dr Nadeem Ul Haque delivering the keynote on tax policy reforms and FCA Muhammad Rehan Siddiqui presenting on faceless jurisdiction and digitalization.

Speaking for the organizers, Ehsan-ul-Haq Sheikh, Rana Saqib Munir and Abdul Qadir Memon appreciated the government's continued engagement with the tax community and reaffirmed their commitment to building a simpler, more transparent and business-friendly tax system.

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