Interim government rows back on splitting NBR amid protests

Faced with intense backlash and staff resistance, the interim government has backed down from implementing a controversial ordinance that sought to split the National Board of Revenue (NBR) into separate wings for revenue policy and administration.

In a notification issued on Thursday, the finance ministry said the NBR would continue operating under its existing structure, admitting that enacting the ordinance, even with amendments, was proving to be “extremely time-consuming”.

But the retreat was triggered by deep unrest.

Officials at the NBR had reacted furiously to the proposed restructure, with the NBR Reform Unity Council mobilising staff and preparing to escalate their protest.

The Council said it would announce its next course of action soon.

The finance ministry acknowledged that implementing the ordinance would require a complex and lengthy process involving the formulation of two new organisational frameworks, post creation through the Ministry of Public Administration, approval from the Expenditure Management and Implementation Divisions, and clearance by the secretaries’ committee—steps it now admits cannot be rushed.

In the statement, the finance ministry said the ordinance cannot be enforced immediately, calling its implementation “impossible” without first completing a series of time-consuming legal and administrative tasks.

These include "changes to the allocation of business rules, amendments to the Income Tax Act, Customs Act, VAT Act, and all associated regulations", the statement read.

“So, there is no possibility of the National Board of Revenue being abolished right away.”

The ministry also clarified that the NBR has not been abolished yet, despite the ordinance being issued on May 12. It added that the actual date of enforcement would be announced through a separate gazette notification.

Meanwhile, discontent among revenue officials continues to mount. Officers and employees from the Income Tax and Customs cadres have been protesting the ordinance since it was first announced, demanding its immediate repeal.

On Thursday, protest leaders under the banner of the NBR Reform Unity Council submitted a memorandum to the chief advisor of the interim government, formally outlining their objections and demands.

The deadlock now puts the fate of the ambitious reform plan in question, as both bureaucratic complexity and internal resistance stall its rollout.