ISLAMABAD: The government is aiming to announce the federal budget on
May 22, according to a communication received at the tax bureaucracy
last week, as confusion reigns over the status of the current and
incoming chiefs of the Federal Board of Revenue (FBR).
Meanwhile, the summary to
appoint
Shabbar Zaidi, a Karachi-based chartered accountant, as new
chairman of
the FBR was returned by the cabinet since it contained powerful
reservations about the appointment.
Jehanzeb Khan had been conducting in-house meetings to coordinate the
drawing up of a revenue plan and projections that are necessary
preparatory work for any budget exercise when he learnt from television
reports on Friday night that a decision had been made to end his tenure
as FBR chairman. Since a transfer order to that effect had not been
received by him, sources at the FBR told
Dawn, he continued with his assignment, discharging his responsibilities on Saturday as well.
“Budget-related meetings were held at the FBR even after the
announcement of the termination of his services hit the airwaves,” an
informed source told
Dawn, until Prime Minister Imran Khan made
public the name of the replacement. “After that the incumbent chairman
could not continue with his work” and budget preparations at the FBR
ground to a halt.
Cabinet fails to approve name of new FBR chairman as work grinds to a halt
A meeting of the federal cabinet was to approve the name of Shabbar
Zaidi, the third private sector individual to head the FBR, as
replacement for Jehanzeb Khan, but several sources present at the
meeting told
Dawn that the summary seeking the approval had to be withdrawn.
According to them, the prime minister was cautioned against pushing
the nomination through since a judgement of the Islamabad High Court
holds the field in the matter of private sector appointments to such
posts. It lays down strict criteria that must be followed before making
such an appointment.
The summary was sent by the Establishment Division but, according to
those who saw it, the summary contained important reservations.
The Establishment Division secretary is reported to have raised two
major objections to the appointment — a conflict of interest in
appointing a private sector chartered accountant whose job all along has
been to advise large business houses on tax matters, and the failure to
have followed the guidelines laid down by the Islamabad High Court in
the nomination of private sector individuals to such positions.
In the case of the latter, the summary is reported to have said that a
notification issued by the Establishment Division would be open to
contempt of court charges since the criteria laid down for such
appointments have not been followed. Those criteria include, for
example, public advertisements for the post and interviews with
interested candidates.
These were spelled out in the Arshad Ali Hakeem case from 2013, in
which the Islamabad High Court actually struck down the appointment of
the last private sector FBR chairman for not having been made in
accordance with the law.
Such steps have not been followed in the case of Shabbar Zaidi’s
appointment either, and at least a staff association within the FBR has
threatened legal action against the appointment should an official
notification be issued.
According to a source present at the cabinet meeting, the prime
minister “expressed his displeasure” and ordered that the issue be
resolved “in 48 hours”.
Meanwhile, budget-related work at the FBR has ground to a halt, and an impasse is now looming before the government.
Complying with the procedure laid down by the apex court in its
judgement could take months, but the government needs an active FBR
chairman immediately to proceed with budget preparations. On top of
that, the beginning of Ramazan sees slackness in the pace of work and
Eid holidays will also complicate the calendar, given the tight
timelines.
On Tuesday, an FBR official told
Dawn, Jehanzeb Khan spent
the day in his office since he is still the chairman legally until his
notification for transfer is issued by the Establishment Division. But
he did not attend to any important matter.