The Federal Board of Revenue (FBR) has separated the administration of sales tax and Federal Excise Duty (FED) from income tax as part of a major restructuring of the country’s tax administration.
The tax authority has transferred and posted 54 Inland Revenue officers, ranging from Grade 17 to Grade 21, to a newly established wing dedicated to sales tax and FED.
The FBR has also created a new position of Member, Sales Tax and FED (Technical) at its headquarters in Islamabad.
According to an official notification, Dr Muhammad Sarmad Qureshi, a Grade-21 officer of the Inland Revenue Service, has been appointed to head the new wing.
The move is aimed at establishing a separate administrative structure for sales tax and federal excise duties, with dedicated officers and field formations across the country.
The FBR has prepared a phased implementation plan to introduce the new administrative arrangement.
Under the proposed schedule:
· 1 December 2026: Separate sales tax units will begin operating in Large Taxpayer Units (LTUs) and Corporate Tax Offices (CTOs), initially under the supervision of their respective commissioners.
· 1 January 2027: Dedicated sales tax units will become operational in Regional Tax Offices (RTOs).
· 1 March 2027: Separate Chief Commissioners for Sales Tax will be appointed.
The restructuring is expected to give sales tax and FED administration a more specialised structure, with dedicated management and operational responsibilities.
The FBR’s Board-in-Council has approved the new Member position, while the organisation’s structure has also been revised to reflect the new reporting arrangements.
However, the tax authority has not yet announced a separate position of Member, Income Tax (Technical).
As a result, income tax matters will continue to be handled through the existing administrative structure, including the Member Inland Revenue (Operations).
Meanwhile, separate sales tax units and zones will gradually be established within the FBR’s field formations.
The changes mark an important step in the FBR’s wider restructuring programme, with the aim of separating key tax functions and strengthening administrative oversight.
The full impact of the new arrangement will become clearer as the phased implementation progresses through March 2027.
