The hardening state

Pakistan's tax machinery is increasingly demanding more stringent powers, yet the actual recovery of revenue is proving more difficult. The introduction of a new production monitoring system by the Federal Board of Revenue (FBR) might offer a technological direction for enhanced surveillance, but it cannot be the primary solution for the state's next generation of revenue measures.

The pursuit of increased coercive powers is a standard operating procedure for civil servants. In the tax bureaucracy, this demand can be traced back to the mid-1990s, when tax authorities first gained arrest powers. These powers have been gradually expanded over the years, with surveillance capabilities added. In 2008, tax officers received significant boosts in powers, including warrantless access to materials and bank accounts, along with real-time data feeds from various government departments.

While the enhancement of these powers can be seen as a normal evolution in response to economic growth and technological advancements, the article argues that it is not a sustainable revenue plan. Relying on enhanced enforcement and audit powers for future revenue needs is a mistake, particularly when the government lacks its own policy vision. This vacuum allows civil servants to drive the agenda, as seen when Imran Khan's promised FBR reforms resulted in little more than a vague, largely unfulfilled promise to separate tax policy from administration.