ATAIC MACRO PROFILE Area
10.53 sq km
Population
893.00 mill
Lbr Force
328 mill
GDP
$ 3.50 Trillion
Agg revenues
$ 419.50 bill
Agg expend
$ 427.00 bill
Exports
$ 542.00 bill
Imports
$ 441.00 bill
Pub debt % of GDP (partial infor)
794%
External debt
$ 516.00 bill
ASSOCIATION OF TAX AUTHORITIES OF ISLAMIC COUNTRIES (ATAIC) - PROFILE. country
area sq km
Bangladesh
population mill
gdp gdp $ bill
gini
per capita index
$
144000
147
331
2200
Brunei
5770
0.38
6.842
23,600
Comoros
2170
0.691
0.441
600
1001450
79
328.1
4200
214970
0.767
3.62
4,700
Indonesia
1919440
245.5
935
3800
Iran
1648000
68.688
610.4
8900
Iraq
437072
26.8
94.1
1900
Jordan
92300
6
28.89
4900
Kuwait
17820
2.4
52.17
21600
Lebanon
10400
3.9
21.45
5500
Malaysia
329750
24.4
308.8
12700
49.2
Morocco
446550
33
147
4400
Pakistan
803940
166
427
2600
11437
0.885
26.05
29400
196190
12
22
1800
71740
6
5.38
900
2505810
41
96
2300
143100
7
9.4
1300
527970
21.5
20.38
900
Egypt
Guyana
Qatar
Senegal
Sierra Leone
Sudan
Tajikistan
31.8
lbr force mill
pub debt externa mily exp revenuesexpendit reservesexports imports gdp % debt gdp% U.G.E $ bill $ bill $ bill $ bill $ bill $ bill gdp%
agri 19.9 ind 20.6 serv 59.5
68
6.389
8.694
11.17
13.77
agri 3.6 ind 56.1 serv 40.3
0.146
3.765
4.815
4.514
1.641
0
5.10% NA
0.1445
0.0276
0.034
0.115
0.232
3% NA
agri 14.7 ind 35.5 serv 49.8
21.8
21.32
31.83
26.3
24.22
35.86
agri 35.5 ind 19.3 serv 45.2
0.418
0.36
0.43
0.295
0.622
0.707
34.8
agri 13.1 ind 46 serv 41
108.2
75.58
79.45
43.04
102.3
77.73
43.8
130.4
3%
19.6
43
agri 11.2 ind 41.7 serv 47.1
24.36
104.6
100.6
58.46
63.18
45.48
25.30%
14.8
3.3
19.3
agri 7.3 ind 66.6 serv 26.1
7.4
30.8
34.6
15.65
32.19
20.76
agri 3.6 ind 30.5 serv 65.9
1.512
4.191
5.305
5.55
4.798
10.42
79.9
9.071
agri 0.4 ind 48.3 serv 51.3
1.136
59.58
33.62
11.08
56.06
19.12
8.1
19.7
4.2 NA
1.5
4.444
7.429
16.78
1.881
9.34
209
31.1
3.1
35.6
agri 8.3 ind 48.1 serv 43.6
10.73
31.63
37
82.3
158.7
127.3
46.7
57.77
2.03
32.1
40
agri 13.3 ind 31.2 serv 55.5
11.25
15.85
20.39
18.21
11.72
21.22
70.9
17.9
5
38.4
41
agri 22 ind 26 serv 52
48.3
20.55
25.65
13.29
19.24
26.79
55
42.38
3.9
38.4
agri 0.1 ind 77.2 serv 22.6
0.508
22.51
16.89
5.755
33.25
12.36
23.6
25.7
41.3
agri 18.3 ind 19.2 serv 62.5
4.749
2.023
2.377
1.18
1.478
2.98
17.8
1.628
62.9
agri 49 ind 31 serv 21
1.4
0.096
0.351
0.185
0.531
agri 35.5 ind 24.8 serv 39.7
7.4
7.943
10.1
3.552
7.505
8.693
34.7
agri 22.7 ind 28.5 serv 48.8
3.7
0.527
0.622
0.209
1.16
1.513
33.4
agri 12.5 ind 43.8 serv 43.7
5.759
7.314
6.984
6.735
8.214
5
agri 40 ind 4 serv 56 34.4
36.4
agri 7.0 ind 21 serv 72
. Yemen
sectoral gdp %
Notes: Revenues (J) : "Aggregate" Revenues [ Tax+Non-Tax]. Expenditures(K): "Overall" Expenditures [inc. Capital Expenditures]. NA: data not available U.G.E:速: Underground Economy. The data tabulated reflects position as on 30-06-06. Sources are various but authoritative.
3.278
46.7
102.9
22.55
22.59
1.2
1.80%
3.40%
30
38.4
0.90% NA
81.48 NA
59.6
36.8
NA
11.4
10 NA
1.4
1.61
1.7 NA
29.69
3 NA
0.829
3.9 NA
5.5
19.4
6.4
45.2
27.5
Directorate General of Training & Research (Direct Taxes) Conference of Heads of ATAIC Training Institutions 12-14 March, 2007
CONFERENCE SESSION IN PROGRESS
`
Table of Contents i.
List of delegates
9-11
ii.
Conference program
11-13
iii.
Final Report
14-20
iv.
Conference recommendations
21-24
v.
‘Rapporteurs’ Report
25-56
vi.
Appendix
57
vii.
Address to delegates by DG(DOT)(DT)
58-72
viii.
Address to delegates by member (DT)
73-78
ix.
CBR Logo
79
ATAIC Association of Tax Authorities of Islamic Countries Conference of Heads of Training Institutions (Direct Taxes)
Part – II Conference Proceedings as Recorded by the Rapporteurs
March 12–14, 2007
Venue: DOT Complex, Lahore, Pakistan.
FOREIGN DELEGATES I.
KUWAIT 01. Mr. Muhammad W. Al-Wasmi 02. Mr. Abdullah Y. Al-Nami
II. MALAYSIA 03. Madam Noor Azian Abdul Hamid Director Malaysia Tax Academy 04. Madam Noraini Mustafa Director Human Resource 05. Mr. Zaid Abdullah Principal Assistant Director Audit Training Centre III MOROCCO 06. Mr. Omar Al Madani Head of Multilateral Co-op Unit
IV
V.
07. Mr. Mohammad Said Bentaouet Manager Central Training Department PAKISTAN 08. Mr. Muhammad Talha Member (Human Resource Management) Central Board of Revenue, 09. Mr. Muhammad Muneer Qureshi Director General Directorate General of Training & Research (Income Tax) SUDAN 10. Mr. Ibrahim Mohamed El-Hﾄ《san Ibrahim Head of Training Administration 11. Bushra Mohamed El-Makki Al-Khalifa Scientific Supervisor in the Training Administration 12. Jalal Eldein Suleman Gibereel Osman I. T Manager in the T.A.
VI. YEMEN 13. Al-Haj Mohammad Saeed Yemen Tax Authority
VII. TURKEY 14. Fayyaz Yazar Chief Tax Inspector
[OBSERVER]
15. Mr. Hassan Kaymak 16. Bulent Buyukdigan Chief Revenue Controller VIII IBFD [OBSERVER] 17. Aurobindo Ponniah International Bureau of Fiscal Documentation (IBFD) Malaysia 18. Dr. V. Van Kommer Manager Government Consultancy International Bureau of Fiscal Documentation (IBFD) P.O. Box 20237, 1000 HE Amsterdam, Neatherland IX. USA [DEPTT. OF TREASURY] 19. Lee Niederman Regional Training Coordinator
[OBSERVER]
REVISED PROGRAM CONFERENCE OF HEADS OF ATAIC TRAINING INSTITUTIONS Venue : Directorate General of Training & Research (Direct Taxes) Allama Iqbal Town, Lahore, Pakistan Day 1 Monday, 12th March 2007 0900 – 0930 Hrs.
Registration of delegates
0930 – 0950 Hrs.
Guests to be seated
1000 – 1030 Hrs.
Opening Session
1030 – 1100 Hrs.
•
Welcome speech by DG, DOT.
•
Address by Chief Guest Mr. M. Abdullah Yusuf, Secretary General [Revenue Division] / Chairman, CBR / Chairperson ATAIC.
Tea Break First Session
Time
Chairperson
Co-Chairperson
Madam Noor Azian Abdul Hamid (Director Malaysian Tax Academy)
Rapporteur
Mr. Salman Nabi (Member, Direct Taxes, CBR)
Ms. Iram Adnan (Additional Director, DOT)
1100 – 1145 Hrs.
“Vision of CBR Training Strategy” (paper to be read by Mr. Muhammad Talha (Member HRM) CBR Pakistan
1145 – 1205 Hrs.
“Training at the Civil Services Academy” (Paper to be read by Maj. Gen. (r) Sikandar Shami, Director General, Civil Services Academy, Lahore)
1205 – 1245 Hrs.
“Computerization of tax records and selection of cases for audit” (Paper to be read by Mr. Fayyaz Yazar, Chief Tax Inspector, Turkey.)
1245 – 1330 Hrs.
Training Needs Analysis “Multidimensional and Integrated Training” (Paper to be read by Mr. M. Munir Qureshi, DG (DT), DOT, Lahore)
1330 – 1430 Hrs.
Lunch / Prayer Break Second Session
Time
1430 – 1545 Hrs.
Chairperson
Co-Chairperson
Rapporteur
Mr. Khurshid Sattaur (Commissioner General, Guyana Revenue Authority)
Mr. Muhammad Talha (Member HRM ,CBR)
Ms. Iram Adnan (Additional Director, DOT)
“Simulation Techniques in Training, Forensic Investigation, Computer Forensics” (Papers to be read by, Madam Noor Azian Abdul Hamid, Madam Noraini Mustafa and Mr. Zahid Abdullah, Delegates from Malaysia.)
1545 – 1700 Hrs.
The “Tax Management System” (TMS) in Pakistan (Paper to be read by Mr. Nasir ud Din Khan, CEO, Pakistan Revenue Automation Ltd).
1900 HRS: Visit to Lahore Landmarks / Dinner at Cuckoo’s Restaurant.
2
Day 2 Tuesday, 13th March 2007 Time
Chairperson
Rapporteur
Co-Chairperson
Ms. Rahela Chowdhury (Director General, Tax Training Directorate, Bangladesh)
Mr. Abdur Razzak (Member, Audit ,CBR)
Ms. Amna Faiz Bhatty (Deputy Director, DOT)
3rd Session 0900 – 1000 Hrs.
1000-1100Hrs.
1100 – 1130 Hrs.
Training Needs Analysis (Ways and Means) (Papers to be read by Mr. Omar Al Madani (Head of Multilateral Cooperation Unit, Morocco) and Sudan) Training Needs Analysis (Ways and Means) (Paper to be read by Mr. Ibrahim Muhammad Elhassan Ibrahim (General Manager of training & taxation Institute, Sudan) Tea Break 4th Session
Time
Chairperson Mr. Muhammad Raza Abdi, (Deputy of Iranian National Tax Administration for Planning and Research)
1130 – 1330 Hrs.
1330 – 1430 Hrs.
Rapporteur
Co-Chairperson Maj. Gen. (Rtd.) Muhammad Yasin (Member Admin. ,CBR)
Ms. Amna Faiz Bhatty (Deputy Director, DOT)
Training methodology / Country Models (Papers to be read by each country participant on their respective methodologies.) 1130 – 1200 Hrs.
Bangladesh
1200 - -1230 Hrs.
Guyana
1230 – 1300 Hrs.
Iran
1300 – 1330 Hrs.
Malaysia
Lunch / Prayer Break 5th Session
Time
Chairperson Mr. Omar Al Madni (Head of Multilateral Cooperation Unit, Morocco )
1430 – 1700 Hrs.
Rapporteur
Co-Chairperson Mr. Mumtaz Ahmad Sheikh (Member Legal ,CBR)
Ms. Amna Faiz Bhatty (Deputy Director, DOT)
Training Methodology- Country models ……Contd from 4th session 1430 – 1500 Hrs
Morocco
1500 – 1530 Hrs.
Turkey
1530 – 1600 Hrs.
Sudan
1600 – 1630 Hrs.
Yemen
1630 – 1700 Hrs.
Indonesia
1900 HRS: CULTURAL EVENING / DINNER
3
Day 3 Wednesday, 14th March 2007 Time
Chairperson
Rapporteur
Co-Chairperson
Mr. Fayyaz Yazar, (Chief Tax Inspector, Turkey)
Mr. Mahmood Alam (Director General, Customs, Sales Tax & Federal Excise, CBR)
Dr. Yasmin Fatima (Deputy Director, DOT)
6th Session 0900 – 1100 Hrs.
Brainstorming Session in which participants to be divided into 4 groups for group discussions on the following topics: 1. 2. 3. 4.
1100 – 1130 Hrs.
Infrastructural / Human resource requirements Developing good Evaluation Criteria Course design and instruction methodologies. Scope of Cooperation in Training amongst member countries
Tea Break th
7 Session Presentations by sub groups of Brainstorming Session.
1130 – 1330 Hrs.
1330 – 1430 Hrs.
1130 – 1200 Hrs.
Presentation of Group 1 and Q & A Session
1200 – 1230 Hrs.
Presentation of Group 2 and Q & A Session
1230 – 1300 Hrs.
Presentation of Group 3 and Q & A Session
1300 – 1330 Hrs.
Presentation of Group 4 and Q & A Session
Lunch / Prayer Break Concluding Session
1430 – 1700 Hrs.
Recommendations of the delegates on future cooperation to be presented by Mr. Muhammad Munir Qureshi, DG, DOT Address by the Secretary General [Revenue Division] / Chairman, CBR / Chairperson ATAIC Certificate Distribution and Speech by the Chief Guest
UPDATED ON 07.03.2007.
Int’l Conference of Heads of Training Institutions of the Association of Tax Authorities of Islamic Countries (ATAIC).
By Muneer Qureshi Director General DOT(DT)
The first Conference of ATAIC Heads of Training Institutions was held at the Directorate General of Income Tax (Training and Research), Lahore from March 12 -14, 2007. Nine countries represented by seventeen delegates, including observers, participated. The theme of the conference was “Technology as a Force Multiplier in training and the workplace.” The purpose of holding this conference was to look in-depth at the existing arrangements for training of direct tax personnel in the ATAIC group, to evaluate different options to improve the same and develop a broad consensus on the key issues involved and the best practices in this area. The poor yield from taxation is a feature common to many countries of the ATAIC group. The tax to GDP ratios are well below those achieved in the developed countries where a yield of 20% and above vis a vis GDP is not uncommon. And in the highly developed
Scandinavian countries tax to GDP ratios of 40% and above are commonplace. In the ATAIC group the average “aggregate revenue” [tax and non-tax revenue] for the entire group comes to just 419.5 bill dollars US which is just 12% of the overall GDP of 3474 billion dollars. Considering that the aggregate revenue includes both tax and non tax revenue, the yield from taxation is certainly very much on the lower side. Countries like Pakistan have a tax to GDP ratio of just about 10%. Needless to say this needs to be improved drastically. Only three countries of the ATAIC group, oil rich Kuwait, Qatar and Iran are able to generate aggregate revenues significantly in excess of their aggregate expenditures.
Consistent with the Conference theme, presentations were made on a wide range of topics including Forensic Audit, Computer Forensics, Simulation methodology, Computerization in the tax department and it’s role in selecting Returns for audit, data warehousing, multi-dimensional training methodology etc
1
The use of modern technology has revolutionized work place practices in all areas. Information Technology has probably had the biggest impact of all the different technologies available. At the heart of Information Technology is the ubiquitous computer. This may be a full fledged ‘mainframe,’ a ‘mini mainframe,’ or a P.C. Whatever it’s configuration, given appropriate software, a networked environment and suitable peripherals, this machine has magnified enormously the human capability to store, retrieve and process vast amounts of raw data. In revenue mobilization, the training of tax personnel in diverse disciplines is today heavily dependent on modern technology. Forensic audit, computer forensics and Simulation are all highly specialized areas in which tax personnel need to be trained intensively in order to make it possible for them to conduct meaningful audit, detect tax evasion, bring the concealed / suppressed income to tax and, in selected cases, successfully prosecute tax evaders in a court of law, leading eventually to a significant jump in government revenues – revenues necessary to launch programs of economic development and meet other pressing expenditures, including those on Defense and Administration. At the DOT(DT) main campus at Lahore there has already been a sea change in the induction of modern technology to impart training to tax personnel. Four, state of the art computer labs with 100 odd P-IV branded computers with comprehensive, uninterrupted power backup placed in a fully networked environment are the core component of the new technology dedicated to provide training on the Tax Management System (TMS) newly developed by Pakistan Revenue Automation Ltd, a fully owned CBR subsidiary company. Besides, multi-media projection, electronic ‘blackboards’[panaboards] with built in scanner, laser printers and flat bed optical scanners etc lend full support. It is now possible to render realistic simulation scenarios using dedicated, proprietory software.
DOT(DT) is also well on the way of becoming a full fledged member of the International Bureau of Fiscal documentation and will soon
be able to tap the superb on-line IBFD resources including comprehensive data base and specialized tax journals and this promises to lead to a quantum jump in DOT(DT) training potential. Incidentally, IBFD membership does not come cheap and CBR’s willingness to commit significant resources to the much sought after membership of this prestigious institution is symbolic of governments firm resolve to upgrade the training and research establishment and bring it up to International standards. The first Conference of ATAIC Heads of Taxation Training Institutions was inaugurated on the 12th March 2007 by Mr Salman Nabi, Member (Direct Taxes), CBR, and in his inaugural address he recapitulated Pakistan’s participation in the ATAIC Technical Conferences held so far and CBR’s initiative in emphasizing the need for a conference convened expressly to appraise the arrangements for training of taxation personnel within the ATAIC group.
Mr SALMAN NABI, MEMBER, CBR (DT)
He pointed out that most ATAIC member countries were facing recurring fiscal deficits and there was an urgent need to augment revenues meaningfully which can only happen if there was a very well trained workforce of taxation personnel. Mr Salman Nabi drew attention to the fact that in an era of globalization and economic integration it was imperative that taxation personnel are familiar with the latest investigative techniques and understand the relatively new science of computer forensics for which a concerted training effort was necessary. He pointed out 2
that a beginning had already been made by DOT when in 2005 a 12 day workshop on revenue forecasting was organized using the micro simulation approach developed by a foreign consultant to plot future revenue streams. He expressed complete confidence in DOT’s ability to conduct more workshops on these lines and advised that DOT implement a CBR commitment to the United Nation’s to use the available training facilities at DOT on an international plane.
DELEGATION FROM SUDAN
DELEGATES FROM MOROCCO & Member (Admn)CBR, Pakistan.
US Treasury Deptt Delegate
Mr Muneer Qureshi, DG(DOT)(DT) also spoke on the occasion.
DELEGATES FROM KUWAIT
The Head of Pakistan’s training establishment for Direct Tax personnel recounted changes made in DOT(DT) curricula and methodology in the wake of wide ranging tax reforms introduced by the present government since 2001 and the upgradation of training facilities at DOT(DT). During the conference proceedings delegates from all the participating countries made presentations and there was something of value in each presentation.
DELEGATE FROM YEMEN
3
ATAIC Member but because of it’s active participation as an ‘Observer’ in all ATAIC conferences / meetings, is identified as a ‘Best Practices country’ in these areas that ATAIC members can emulate. It is our ardent hope that Turkey will soon , InshaAllah, become a full
Delegate from the IBFD, the Netherlands.
However the presentations by the delegates from Malaysia and Turkey do need special mention. Malaysia has made significant progress in developing training modules in Forensic Audit, Computer Forensics and Simulation and has been identified as a ‘Best Practices’ ATAIC Member in these disciplines. The efficacy of Tax Administration in Malaysia is evident from the fact that with a population of just 24 million it has more than
fledged member of the ATAIC. The progress made by Turkey in the imaginative use of computers and related Information Technology is evident from the fact that 91% of corporate tax taxpayers in Turkey use the e-filing channel for tax Returns and overall some 67% of the total taxpayer population [corporate and non corporate] required to file Tax Returns use the echannel. This translates into savings of some 6000 tons of paper annually with a monetary value of some 3.4 million euros. From Pakistan there was a useful presentation by Pakistan Revenue Automation (PRAL) CEO, Mr Nasir Khan on the computerized Tax
DELEGATES FROM MALAYSIA
four million registered taxpayers (20% odd). Likewise, Turkey has much to offer in computerization generally and more particularly, ‘data ware housing’ and although not yet an
Management System (TMS) in which DOT(DT) facilities have been used to provide training to a core group of ‘master trainers’ who are now in a position to impart training to members of CBR’s field formations in different parts of the country. The TMS is unique in that it has been developed by CBR / PRAL using in-house expertise. It is based on the ‘Oracle’ Data Base platform and is being used to input tax data to build a unque profile of each taxpayer and to implement and store statutory orders relating to income tax assessment, rectification and refunds.
DELEGATES FROM TURKEY
4
Mr Muhammad Talha, Member (HRM) CBR,
[Pakistan] made a very succinct presentation on “CBR Vision for Training / Capacity Building
seeks to relate course content with the conditions actually prevalent in the economy and training is thus made more meaningful and more relevant to the real world in which tax personnel work. The ‘under ground economy’ is one such real world scenario in which the new training methodology holds much promise. The UGE is of great significance to most developing countries in that this segment robs the exchequer of considerable tax revenue besides creating destabilizing distortions in the economy and under mining the rule of law in the country. The capacity building training at DOT(DT) makes full use of this new training methodology as does the specialized training program (STP) for the income tax group probationary officer’s. Maj Gen® Sikandar Shami [(HI(M)], Director General of the prestigious Civil Services Academy- where the training of the ‘raw’ CSS
and explained how the reform process has evolved since 2001 with special reference to the training program for CBR personnel. Also from Pakistan, Mr Muneer Qureshi, the Director General DOT(DT) explained to the conference delegates the new ‘multi dimensional’ training methodology being developed and implemented at DOT(DT).
Maj Gen® Sikandar Shami, DG, CSA
‘recruits’ entering federal government service actually begins- gave a very lucid presentation on the initial training process and explained how they too at CSA are using modern approaches to teaching to achieve optimal benefit. At the end of the three days of intensive deliberations, the delegates agreed on nineteen recommendations and the following communiqué has been released by DGDOT(DT) and sent to all ATAIC Members:
DG(DOT)(DT) In contradistinction to the previous, lecture based ‘uni-dimensional’ training methodology in vogue since 1947 [and even earlier!], the new holistic, ‘multi-dimensional’ training methodology exploits new approaches to learning including dynamic, interactive class participation, case study, role play and simulation. It was explained that this approach
RECOMMENDATIONS OF THE DELEGATES PARTICIPATING IN THE CONFERENCE OF HEADS OF ATAIC TRAINING INSTITUTIONS HELD AT DOT(DT), LAHORE, PAKISTAN. March 12 – 14, 2007. The Reports as submitted by the Conference Rapporteurs having been scrutinized, corrected / amended, where necessary, and finally duly approved by the respective Chairpersons in the various Sessions, It is hereby resolved that: 1.
The officer’s of the (Taxation) Training Institutions of the Association of Tax
5
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
Authorities of Islamic Countries (ATAIC) will continue to meet at regular intervals to discuss and consider issues pertinent to the training of their taxation personnel. All Members of the ATAIC shall participate fully in Conferences / Workshops held and absence will be avoided. To improve interaction between Members, special efforts will be made to overcome the “language barrier” between Members. Normally, English (UK) will be used as a common medium of expression between Members and Members will make efforts to improve the English expression and comprehension of their Taxation Training Institutions personnel, especially those likely to participate in International Conferences. When ATAIC Members hold Conferences, where possible, simultaneous translation facilities (English to Arabic) will be provided. There shall be improved sharing of relevant information between ATAIC Members and the World Wide Web /Internet will be fully and properly put to use in this context. Relevant statistical information / data will be organized and maintained in a common, mutually acceptable format, with effective safeguards / security to ensure data integrity but at the same time readily accessible by Members. ATAIC Members will make their Training Institutions / facilities available for training of each others taxation personnel on a reciprocal, ‘no profit, no loss’ basis. As far as possible, Members will endeavor to use state of the art but “appropriate” technologies in imparting instruction, including “information technology.” Members will also use dynamic but “appropriate,” multi-dimensional training methodologies, including ‘simulation modules,’ in imparting instruction. Members will consult each other on curricula for different subjects in which instruction is imparted in the training institutions and will endeavor to ‘harmonize’ curricula used, as far as is practical and feasible. There shall be special emphasis on providing training in ‘forensic audit,’ and ‘computer forensics’ to taxation personnel. The imaginative use of information technology, including computers and related peripheral equipment, will be accelerated in training institutions. Malaysia will be “Best practices model” in imparting instruction in ‘Forensic Audit,’ ‘Computer Forensics’ and in the use of ‘Simulation Methodology’ in training.
15.
16.
17.
18. 19.
Turkey (OBSERVER COUNTRY but active participant) will be “Best practices Model” in computerization and data warehousing. Pakistan’s experience with ‘Self Assessment’ / ‘voluntary compliance,’ ‘Withholding Taxation’ and ‘Joint Audit Training’ will be referred to by Members in designing their training programs. The Pakistan Direct Taxation Training Institution (DOT(DT)) will make necessary arrangements to provide training in English Language communication skills to ATAIC Members desirous of receiving such training, on a ‘no profit, no loss’ basis. The ‘Informal Sector’ will receive special emphasis in the Training curricula. ATAIC Taxation Training Manuals will be digitized and On-Line access by Members will be enabled.
Issued by M Muneer Qureshi DG(DOT)(DT), the Conference Convener, this 14th day of March, 2007 and sent to all Members of the ATAIC.
DOT(DT) was privileged to have the Chairperson ATAIC, Mr M Abdullah Yusuf – who is also the Secretary General, Revenue Division and the Chairman CBR- in person,
MR M ABDULLAH YUSUF, CHAIRPERSON, ATAIC, SECRETARY GENERAL, REVENUE DIVISION, CHAIRMAN, CBR.
to address the conference delegates on the final session of the conference. Mr Abdullah Yusuf congratulated the delegates on a ‘job well done’ and exhorted them to make full use of the latest technological developments to increase the efficiency and productivity of the ATAIC taxation personnel. He said that while there was no need to try and “re-invent the wheel,” nevertheless, it was necessary that developing countries be aware of latest technological developments and be willing to use such technologies after imparting suitable training to the workforce. Proper training is 6
CHAIRPERSON ATAIC WITH DELEGATES FROM MALAYSIA
thus a ‘condition precedent’ to the ability of tax administration to devise effective technological solutions to the many complex problems faced in revenue mobilization. In this context he referred especially to ‘data warehousing’ and ‘information technology’ and advised ATAIC members to share information in these and other areas of mutual interest.
CHAIRPERSON ATAIC WITH US TREASURY DEPTT DELEGATE
CHAIRPERSON ATAIC WITH ATAIC DELEGATES
CHAIRPERSON ATAIC WITH DELEGATES FROM TURKEY
Mr Muneer Qureshi, DG(DOT)(DT) recapitulated the conference proceedings and gave an update of the recommendations made by the delegates for improvements in the ATAIC Taxation training establishments. He expressed the hope that given the range and quality of facilities available at DOT(DT) it would eventually be transformed into a regional training hub.
7
CONFERENCE OF HEADS OF TRAINING INSTITUTIONS (DIRECT TAXATION) OF THE ASSOCIATION OF TAX AUTHORITIES OF ISLAMIC COUNTRIES AT THE DIRECTORATE GENERAL OF INCOME TAX (TRAINING & RESEARCH), LAHORE, PAKISTAN, FROM MARCH 12, TO MARCH 14, 2007. RECOMMENDATIONS OF THE DELEGATES PARTICIPATING IN THE CONFERENCE. The Reports as submitted by the Conference Rapporteurs having been scrutinized, corrected / amended, where necessary, and finally duly approved by the respective Chairpersons in the various Sessions, It is hereby resolved that: 1.
2. 3.
The officer’s of the (Taxation) Training Institutions of the Association of Tax Authorities of Islamic Countries (ATAIC) will continue to meet at regular intervals to discuss and consider issues pertinent to the training of their taxation personnel. All Members of the ATAIC shall participate fully in Conferences / Workshops held and absence will be avoided. To improve interaction between Members, special efforts will be made to overcome the “language barrier” between Members. 1
4.
Normally, English (UK) will be used as a common medium of expression between Members and Members will make efforts to improve the English expression and comprehension of their Taxation Training Institutions personnel, especially those likely to participate in International Conferences. 5. When ATAIC Members hold Conferences, where possible, simultaneous translation facilities (English to Arabic) will be provided. 6. There shall be improved sharing of relevant information between ATAIC Members and the World Wide Web /Internet will be fully and properly put to use in this context. 7. Relevant statistical information / data will be organized and maintained in a common, mutually acceptable format, with effective safeguards / security to ensure data integrity but at the same time readily accessible by Members. 8. ATAIC Members will make their Training Institutions / facilities available for training of each others taxation personnel on a reciprocal, ‘no profit, no loss’ basis. 9. As far as possible, Members will endeavor to use state of the art but “appropriate” technologies in imparting instruction, including “information technology.” 10. Members will also use dynamic but “appropriate,” multi-dimensional training 2
11.
12. 13.
14.
15. 16.
17.
methodologies, including ‘simulation modules,’ in imparting instruction. Members will consult each other on curricula for different subjects in which instruction is imparted in the training institutions and will endeavor to ‘harmonize’ curricula used, as far as is practical and feasible. There shall be special emphasis on providing training in ‘forensic audit,’ and ‘computer forensics’ to taxation personnel. The imaginative use of information technology, including computers and related peripheral equipment, will be accelerated in training institutions. Malaysia will be “Best practices model” in imparting instruction in ‘Forensic Audit,’ ‘Computer Forensics’ and in the use of ‘Simulation Methodology’ in training. Turkey (OBSERVER COUNTRY but active participant) will be “Best practices Model” in computerization and data warehousing. Pakistan’s experience with ‘Self Assessment’ / ‘voluntary compliance,’ ‘Withholding Taxation’ and ‘Joint Audit Training’ will be referred to by Members in designing their training programs. The Pakistan Direct Taxation Training Institution (DOT(DT)) will make necessary arrangements to provide training in English Language communication skills to ATAIC
3
Members desirous of receiving such training, on a ‘no profit, no loss’ basis. 18. The ‘Informal Sector’ will receive special emphasis in the Training curricula. 19. ATAIC Taxation Training Manuals will be digitized and On-Line access by Members will be enabled. Issued by the Conference Convener, this 14th day of March, 2007 and sent to all Members of the ATAIC.
(MUHAMMAD MUNEER QURESHI) PAKISTAN. DIRECTOR GENERAL, Directorate General of Income Tax, (Training & Research) Sutluj Block, Allama Iqbal Town, Lahore, Pakistan. CC 1. MR M ABDULLAH YUSUF, CHAIRPERSON, ATAIC, SECRETARY GENERAL (REVENUE DIVISION), CHAIRMAN, CENTRAL BOARD OF REVENUE, GOVERNMENT OF PAKISTAN, for information. 2. Mr. Muhammad Talha, Member (HRM), CBR, for information. 3. Mr. Salman Nabi, Member (DT), CBR, for information. 4. All Conference Session Chairpersons & Co-Chairpersons, for information. 5. ATAIC Secretariat, CBR, Islamabad, Pakistan
.
4
ATAIC Association of Tax Authorities of Islamic Countries Conference of Heads of Training Institutions (Direct Taxes)
Part – II Conference Proceedings as Recorded by the Rapporteurs
March 12–14, 2007
Venue: DOT Complex, Lahore, Pakistan. 1
FOREIGN DELEGATES I.
KUWAIT 01. Mr. Muhammad W. Al-Wasmi 02. Mr. Abdullah Y. Al-Nami
II. MALAYSIA 03. Madam Noor Azian Abdul Hamid Director Malaysia Tax Academy 04. Madam Noraini Mustafa Director Human Resource 05. Mr. Zaid Abdullah Principal Assistant Director Audit Training Centre III MOROCCO 06. Mr. Omar Al Madani Head of Multilateral Co-op Unit
IV
V.
07. Mr. Mohammad Said Bentaouet Manager Central Training Department PAKISTAN 08. Mr. Muhammad Talha Member (Human Resource Management) Central Board of Revenue, 09. Mr. Muhammad Muneer Qureshi Director General Directorate General of Training & Research (Income Tax) SUDAN 10. Mr. Ibrahim Mohamed El-Hﾄ《san Ibrahim Head of Training Administration 11. Bushra Mohamed El-Makki Al-Khalifa Scientific Supervisor in the Training Administration 12. Jalal Eldein Suleman Gibereel Osman I. T Manager in the T.A.
VI. YEMEN 13. Al-Haj Mohammad Saeed Yemen Tax Authority VII. TURKEY 14. Fayyaz Yazar Chief Tax Inspector
[OBSERVER]
15. Mr. Hassan Kaymak 2
16. Bulent Buyukdigan Chief Revenue Controller VIII IBFD [OBSERVER] 17. Aurobindo Ponniah International Bureau of Fiscal Documentation (IBFD) Malaysia 18. Dr. V. Van Kommer Manager Government Consultancy International Bureau of Fiscal Documentation (IBFD) P.O. Box 20237, 1000 HE Amsterdam, Neatherland IX. USA [DEPTT. OF TREASURY] 19. Lee Niederman Regional Training Coordinator
[OBSERVER]
3
FIRST SESSION: Chairperson Madam Noor Azian Abdul Hamid, Director Malaysian Tax Academy Co-Chairperson Mr. Salman Nabi, Member (Direct Taxes), CBR SECOND SESSION Chairperson Co-Chairperson Mr. Muhammad Talha, Member (HRM), CBR THIRD SESSION: Chairperson Co-Chairperson Mr. Abudl Razzak, Member (Audit), CBR FOURTH SESSION Chairperson Co-Chairperson Maj. Gen. 速 Muhammad Yasin, Member (Admn.) CBR FIFTH SESSION Chairperson Mr. Omar Al Madni, Head of Multilateral Cooperation Unit, Morocco Co-Chairperson 4
SIXTH SESSION BRAIN-STORMING SEVENTH SESSION Chairperson Mr. Fayyaz Yazar, Chief Tax Inspector, Turkey Co-Chairperson Mr. Mahmood Alam, Director General of Training (Customs, Sales Tax & Federal Excise), CBR
5
Resource Persons Mr. Salman Nabi
Member (Direct Taxes), Central Board of Revenue
Mr. Muhammad Talha
Member (HRM), Central Board of Revenue
Maj Gen 速 Muhammad Yasin
Member (Admin), Central Board of Revenue
Maj Gen 速 Sikandar Shami
Director General Civil Services Academy, Lahore
Mr. Abdur Razzak
Member (Audit), Central Board of Revenue
Mr. Mehmood Alam
Director General of Training & Research (Customs, Sales Tax & Federal Excise), Islamabad
Mr. Nasir Khan
Chief Executive Officer, Pakistan Revenue Automation Limited, Islamabad
6
RAPPORTEURS
Ms. Iram Adnan
Additional Director, Directorate General of Training & Research (Direct Taxes), Lahore.
Ms. Amna Faiz Bhatty
Deputy Director, Directorate General of Training & Research (Direct Taxes), Lahore.
Dr. Yasmin Fatima
Deputy Director, Directorate General of Training & Research (Direct Taxes), Lahore.
7
ORGANIZING COMMITTEE
Chairperson ATAIC
Mr. M. Abdullah Yusuf, Chairman, CBR
Chief Organizer
Mr. M. Munir Qureshi, Director General, DOT, Lahore
Programme Coordinator
Mr. Ihsan Elahi Tariq, Director, DOT Lahore
Mr. Shahid Bashir, Incharge Administration Additional Director, DOT Lahore Incharge Programme & Publication
Dr. Hamid Ateeq, Additional Director, DOT Lahore
Incharge / Liaison Cultural Activities
Ms. Iram Adnan, Additional Director, DOT Lahore
Incharge Protocol
Mr. Imran Raza Kazmi, Additional Director, DOT Lahore
Incharge MIS
Mr. Mohammad Atiq, Additional Director, DOT Lahore
Coordinator (Publication)
Ms. Amna Faiz Bhatty, Deputy Director, DOT Lahore
Coordinator (Horticulture & Admin)
Yasmin Fatima Dr., Deputy Director, DOT Lahore
Coordinator (Security)
Mr. Badar Zaman, Deputy Director, DOT Lahore
Interpreter
Ms. Nasreen Khalid
Layout & Design
Mr. Zafar Iqbal 8
ATAIC Conference. Lahore, Pakistan. March 12 - 14.
Date: 12-03-07. DAY ONE Venue: DOT Complex, Lahore, Pakistan. OPENING SESSION The session started at 1000 hrs and a welcome speech was given by the D.G., DOT. FIRST SESSION: Chairperson Madam Noor Azian Abdul Hamid, Director Malaysian Tax Academy Co-Chairperson Mr. Salman Nabi, Member (Direct Taxes), CBR Rapporteur Ms. Iram Adnan, Addl. Dir, DOT, Lahore The delegates read papers on following topics:
Topics : a) b) c) d)
Vision of CBR Training Strategy. Training at the Civil Services Academy. Computerization of Tax Records and Selection of Cases for Audit. Training need Analysis. 9
SESSION-I: Mr. Muhammad Talha presented the paper on “Vision of C.B.R. Training Strategy,” and made specific reference to re-organizing the existing trainings and re-focusing on the over-all compliance and quality service viza-viz reforms. Central Board of Revenue is pursuing values like integrity, professionalism, teamwork and transparency. Coupled with such values, C.B.R. is, at the same time, striving for increase in revenues and tax base. It is ensuring end to end automation of work processes and tax payer friendly environment. Above all, it is earnestly working towards honest and efficient tax administration. To do this, it has already restructured its formations and functional lines and has developed a well trained and motivated work force in order to develop and manage a more efficient revenue administration. As regards the “Training Policy” of C.B.R., the punch line is that training and development must have a clear benefit for C.B.R. For this, C.B.R. has gone even a step further by supporting self-development or life style training. Above all, the Board is building synergy and consistency in training programs meant for, both, Income Tax and Customs groups, so as to have them as one organization under C.B.R. The existing training programs are at the level of induction, during service (e.g., I.T., Management, Reform Specific Courses etc). C.B.R. also offers various foreign trainings as well as various train the trainer courses. Staff training for junior cadres is also an important aspect of training and it covers subjects like I.T. Law and Communication skills.
10
Training Facilities I.
ENTRY LEVEL TRAINING (BS 17) Assistant Commissioners/Collectors 1.
Common Training Program (CTP) at Civil Services Academy (6 months)
2.
Specialized Training Program (STP) at the Directorates General of Training
3.
MBA Tax Management at Institute of Business Administration (IBA), Karachi
II.
MID TO SENIOR LEVEL TRAINING (BS 17 to BS 21) WORLD BANK CAPACITY BUILDING (TARP)
(i)
Officers Training Programs Strategic Planning & Leadership Finalized with LUMS (BS 20 & 21) Strategic Change Management Finalized with LUMS (BS 20 & 21) Management & Team Building Completed at Karachi (BS 17-19) (400 Officers) Communication & Presentation Skills (BS 17-19)
Completed at Karachi (400 Officers)
(ii)
Train the Trainer Program
• •
Arrangement with the Lahore University of Management Sciences Case Development expertise
(iii)
Staff Training
• • • •
PC skills Business communication skills English language Core/Technical functions related training 11
At this point the delegate from Malaysia inquired about the resources and number of trainers available with the Central Board of Revenue. Mr. Muhammad Talha, Member HRM and presenter of the paper responded to the query with figures. For 25,000 work force, 50 trainers are available and as training is on top of the priority list, funding is no problem. At this point, Mr. Munir Qureshi, Director General, DOT added that apparently 50 trainers for such a large workforce may seem low, but the Directorate General of Training also has the facility of outsourcing certain subjects, whenever required. Mr. Salman Nabi, Member (Direct Taxes) from Pakistan added that apart from the regular trainers and facility of out sourcing, the junior cadre is trained / tutored at respective zonal hubs by their own officers, too. Mr. Ibrahim M. Ehassan from Sudan wanted to know as to how C.B.R hoped to achieve taxpayer fraternity. The query was responded by Mr. Salman Nabi stating that although Pakistan has taxpayers, yet, all of them are not filers. To combat this situation, a database is being developed. The idea is to have data and then to move scientifically. Mr. Omar Al Madani from Morocco inquired about the recruitment process in vogue in C.B.R. Mr. Muhammad Talha explained that keeping in line with the re-structuring process, all recruitments are being made through Internal Job Postings. It follows a pathway of interview, appointment, evaluation and finally an integrity check. Madam Noor Azian from Malaysia was interested to know as to what programs for taxpayer education were adopted by C.B.R. The query was responded by Mr. Muhammad Talha. It was informed Facilitation and Tax Payer’s Education (FATE) caters to this aspect and 12
collaborates with media, public and other organizations. The presentation was applauded and the Chairperson invited the next speaker for the day. The next paper was read by Maj. Gen (R) Sikandar Shami, D.G. Civil Services Academy, on the topic of “Training at the C.S.A”. The speaker explained the selection procedure, the academy’s objectives and the organization of courses / syllabus. The civil servant initially undergoes an exam conducted by Federal Public Service Commission. Later, psychological test and interview are to be cleared. Age limit for the above is 21 to 28 years. The Civil Services Academy inculcates harmony among officers of various regions of Pakistan. It also creates in them an understanding of socio-political / administrative issues and it also ensures that elements like integrity, discipline and efficiency are the hall mark of officers. Special stress is focused on leadership skills with increased emphasis on practical exercises and case studies. Madam Nooraini from Malaysia inquired if all exams of C.S.A were required to be cleared or the officers were graded out of the benchmark of 500 marks only. Presenter of the paper informed that all subjects were required to be passed in the Civil Services Academy. Mr. Omar Al Madani from Morocco wanted to know if there was some system of reward etc. Mr. Shami informed that a large number of awards and medals etc., are given to the excelling officers. Mr. Salman Nabi from Pakistan added that in the Income Tax Group the top 3 officers were awarded 3 lap tops by Central Board of Revenue this year. 13
With this the second presentation for the day concluded. Mr. Fayyaz Yazar from Turkey presented the third paper for the day titled “Computerization of Tax records and selection of cases for audit.� He informed the group about computerization, data warehouse, revenue administration and Turkish Tax System. At this stage Turkey has the biggest portal with 2,500,000 taxpayers. It is saving 6,000 tons of paper (2.5 million Euro/yr.) along with 14,000 man-month (3.4 million Euro/yr.) annually. It has successfully enforced E-Declaration, E-Invoicing, Call Centres, E-Institutions and E-government etc. The ongoing projects include Business Continuity, Disaster Recovery Centre, Web based application and Voice over IP application etc. At this juncture, Mr. Munir Qureshi from Pakistan was desirous to know as to what steps were taken against dataintegrity and if there had been any incidence of data-corruption. Mr. Fayyaz informed that the system has security infrastructure like firewall IDS & IPS, anti-virus, E-mail firewall and content filtering. Side by side to these, managerial measures for security are also ensured which comprise of information security policy document, information security operational procedures, information security tests and information security personnel. Mr. Fayyaz also informed that so far, no case of data corruption has occurred. Dr. Mohamed S. El-haaj from Yemen inquired about the main problems faced by the Turkish Tax Authority in the process of automation. The presenter admitted that although optimal goal in automation had not been achieved as yet but efforts are in field to educate not just the tax authorities but also the tax payers. 14
With this, the third presentation for the day concluded. The fourth paper of the conference was read by Mr. Munir Qureshi from Pakistan titled “Training Need Analysis�, (Multidimensional and Integrated Training). Mr. Munir Qureshi briefly out lined the sequence of training programmes before going into the details of multi-dimensional training. It was informed that where as the entry level training is not whole encompassing the later specialized and capacity trainings include audio-visual techniques, simulation, role play etc. Net objective for multi-dimensional training is to ensure that un-familiar knowledge is also understood well. Here, the presenter referred to the topic of informal economy which has lately been taken up as part of the holistic view of teaching at D.O.T. The presenter also informed that the concept of forensic accounting has also been included in the revised syllabus. Special attention is paid to adult learning by giving officers practical problems and application of past experiences in an informal environment through a variety of training methods. The presenter also informed that Skill Management Courses are handled by DOT itself, where the concept development has been outsourced. At this point, Mr. Zaid from Malaysia asked about the nature / content of audit module. Mr. Munir Qureshi informed that the module for Audit has been designed by the Audit Wing of CBR itself and DOT is only facilitating them by providing the expertise and infrastructure. No more questions were asked and the fourth presentation was concluded with applause.
15
SESSION-II In the afternoon session the delegate from Malaysia made her presentation on “Simulation Techniques�. Madam Azian informed that the training curriculum for Malaysian Tax Academy had been revised. Now the areas of focus are enforcement, customer service and taxpayer education and the modules have a direct link with them. She informed that new training centers have been formed to cope with Investigation, Audit and Stamp duty. Foreign Experts are given assignments of subjects like transfer pricing, criminal investigation computer forensics and tax treaty etc. She informed that simulation training at Malaysian Tax Academy is operative since 2004 which caters to audit training. Target group for such audit simulation is the desk officers who do not have an accounting background. She also discussed the advantages and disadvantages of simulation training. The presenter enlightened the group viza-viz Forensic Investigation. She said it followed 4 phase pathway of investigation consisting of problem recognition, planning and review, evaluation of evidence and finally reporting. The methodology includes bank deposit analysis, net worth analysis, expenditure method and financial investigation. At this juncture, Mr. Muhammad Talha enquired as to whether there was some specific criteria for selection for courses. The presenter informed that no foreigners are admitted to these courses. She also informed that foreign participants are catered to in other courses which are specifically organized for them like GTAC General Tax Administration Course, Tax Enforcement and Tax Treaty Course. 16
Mr. Omar Al-Madani from Morocco enquired whether there were any other courses for foreigners other than tax courses. To this, the reply was in the affirmative. The presenter suggested she could give a list of such courses later. The observer from USA Mr. Lee Niederman enquired if live cases / records were brought from the offices to the academy. The presenter informed that in case of live cases the trainees are taken to the premises. Finally, Ms. Iram Adnan from Pakistan was desirous to know about the fate of hard discs of computers once they are removed from taxpayers’ computers and taken to Income Tax forensic lab. The presenter informed that the respective officer has a regular liaison with the forensic lab and proceedings. Ms. Iram Adnan specifically enquired as to the kind of software being used by the forensic lab. To this, the presenter suggested that the exact information to this query may be sent on her return to Malaysia. With this, the presentation was concluded and applauded. Seventh and final paper for the day was read by Mr. Nasir Khan of Pakistan titled “Tax Management System (TMS)�. The presenter explained the existing I.T. systems, future mode, improvements, timeline and the risks involved. The group was informed about Taxpayer registration, core tax management, e-filing systems, payment recording systems, verification and refund processing etc. The process of automation is however open to risks, writing the right software being one of them. Getting the people to use it is even harder. PARAL needs to conduct diagnostic studies more often as to avoid mistakes and to precisely identify when the 17
bottle necks and risks exist. It also needs to link attributes with reality. At this point, Mr. Muhammad Talha from Pakistan enquired as to what exactly is meant by enforcement module. The query was responded by the presenter, according to whom it is rectification of an anomaly on detection. There were no more questions and the second session of the conference was thus concluded.
18
Date: 13-03-07. DAY TWO SESSION III Co-Chairperson Maj. Gen. ® Muhammad Yasin, Member (Admn.) CBR Rapporteur Ms. Amna Faiz Bhatty, Dy. Dir, DOT, Lahore The delegates of the participant countries read their papers on “Training Methodology – Country Models”: The proceedings of the day began with paper on “TRAINING NEEDS ANALYSIS” [WAYS AND MEANS] read by Mr. Omar Al Madani (Head of Multilateral Cooporation Unit), Morocco, Mr. Omar explained that training of tax officials in Morocco was the responsibility of a central organization by the name of General Tax Administration (GTA). Within the central training department the GTA, there were two different units: - Initial training and international cooperation unit in charge of training of the newly recruited tax officers as well as training abroad; - Continuous training unit in charge of training of tax officials in function at the GTA and practical training at the end of studies for students of high educational institutions and management schools. Training methodology (Ingénierie de la formation) of GTA consists of planning, implementing and following up training programmes with the ultimate goal of success of the organisations’ improvement projects. 19
The training methodology stages:
includes
five
main
• Identification and analysis of training needs • Elaboration of training planning • Implementation and follow up of training • Evaluation of training • Training auditing Mr. Al-Madani further elaborated that the GTA training programs are organized taking into account strategic orientations of the Ministry of Finance and gap between the required competence and the existing one. The training program is elaborated annually by the central training department jointly with regional offices taking into consideration priorities, theme’s pertinence and environmental context. The implementation and follow up of this proceedings is performed by heads of regional training centres and central department. He explained that as training evaluation contributes to management control of training actions , there are two types of evaluation: immediate and posterior. The immediate evaluation also called “Hot Evaluation” is performed through forms filled in by participants submitted anonymously immediately at the end of training session. This evaluation allows the central department of training to be informed of: - Satisfaction level of the participants; - Pedagogical skills of instructors; - Relevance of the chosen topics; - Quality of the training proceedings; Expectations of the participants. Posterior evaluation or “Cold Evaluations “ is a project still in pipeline to be performed in cooperation with France and would allow the GTA to determine methods, techniques and different means and expected feed back. 20
Similarly for audit of training imparted, Ministry of Finance has entrusted the General Inspection of Finance (IGF) to conduct the evaluation of training proceeding system. He concluded his presentation with the remarks that training’s main acquisition remains the tax administrations’ awareness of its strategic importance within the new human resources policy and its role regarding the personnel retraining. The house was then open to a Q & A session. Mr. Munir Qureshi, Director General,. DOT and participant from the host country Pakistan inquired about the sort of technologies being used in imparting training. Mr. Al-Madani explained that in addition to local training, tax officials were being sent to OECD countries particularly Turkey for tax policy modernization trainings. To another query raised by Mr. M. Munir Qureshi it was explained that separate audit training sessions were organized. Mr. Abdul Razzaq, Member (Audit) CBR who was also the Chairperson of the 3rd Session inquired about the criteria adopted for taking retired officials as instructors in the training institutes. It was explained by Mr. Madani that only people with brilliant record of performance were taken as instructors. This was followed by a presentation by Mr Ibrahim Mohamed Ehassan Ibrahim (Head of T.A), the delegate from SUDAN. In his presentation he explained that the Sudanese economy has expanded over years and as a result there is an independent full-fledged entity known as “CHAMBER OF TAXATION” which handles taxation matters. This Chamber employs more than 9000 person with 190-regional offices handling taxation matters in various state of Sudan. This Chamber of Taxation comprises of seven major Directorates, namely; • General Directorate for companies • General directorate for V.A.T.
21
• General Directorate for personal income tax • General directorate for stamp duties • General Directorate for training There is a General Directorate in every state to handle taxation matters in the respective state. In addition 5 unified tax centres have been opened up in 2004 to handle companies taxes in the capital. These centres provide one window system of tax collection with the objective of simplified tax procedures and handling of tax matters of corporate tax payers. Mr. Ibrahim explained that the employees of Chamber can be categorized into three major types: 1) Heads of General Directorate 2) Tax Assessment and Collection Inspectors 3) Administrative and Supervisory Staff Each of these three categories of officials require different training modules as the skill needed for job performance is different in each case. The Training Directorate of the Chamber of Taxation has two well-equipped classrooms along with a fully equipped Computer Lab to provide training to all officials. The training capacity gap is however bridged by institute’s cooperation with other public and private training institutes and universities (out-sourcing). The Directorate also had cooperation ties with training centres in Egypt, Syria and Malaysia. Mr. Ibrahim then shared the governments’ future vision of five years training plan 2007-2011. The year-wise targeted number of trainees is as under:
22
Year 2007 2008 2009 2010 2011
Targeted number of trainees 2500 3000 3500 4000 4500
The delegate further elaborated that since the year under review, the Directorate has started computer literacy program in its Chamber by holding computer courses from all computer illiterate employees. He then concluded his presentation that it should be a high agenda for training department to develop need assessment strategies and promote training for better utilization of human resources. In the Q & A session following this presentation, it was inquired by the delegate from Yemen as to whether there was any classification / categorization of taxpayers. It was explained by the delegate of Sudan that there was a classification of taxpayers in Sudan and incidentally five unified tax centers have been set up in the year 2004 to handle corporate cases. Mr. M. Munir Qureshi asked about the state of computerization in the department. To this query it was explained that uptill 2006 there was no computerization of the Chamber of taxation, however currently initiative was underway to start the process of computerization. The next presentation was by Madam Noraini Mustafa (Director HR) Malaysia. Ms. Noriani presented her paper on training methodology being followed by Malaysia with regards to training of its tax administrators. It was explained by Ms. Noriani that training of tax officials in Malaysia is being imparted by the following authorities / institutes: 23
•
Malaysian Tax Academy (MTA)(APM)
•
Human Resource Development and Training Unit Organizational Development
•
Division (BPO)
•
Investigation Training Center (PLAS)
•
Audit Training Center (PULADIT)
of
Administrative
Department
• Stamp Duty Training Center She further elaborated that training in Malaysia is divided into four levels, namely; -
Elementary level
-
Intermediate level
-
Advance level
Transactional level The elementary training level is imparts to new entrants to the service and the courses taught include; Induction course, Basic taxation course and Basic Management Course. The training methodology followed includes Teachers-centered methods (TTC). These methods includes Controlled discussion, demonstration, guided discussion, lectures and tutorial sessions. The other methodology is Studentcentered methods (TSC) and this method includes case study, group discussion, listening and observing, mini projects, workshops and assignments. The new entrants are also provided on job training which includes job rotation and coaching method. It was explained that the Intermediate level training is imparted to officers having put in 3 – 10 years in service. The focus of these training is to develop officers in certain fields and to realize the aspiration to become a focus organization. The participants of the training are taught advanced courses on taxation to enhance the knowledge, understanding and analytical skills 24
towards accounting principles and examination of business records. The advanced level of training is reserved for officers having put in more than 10-years in service with the objective to retrain and re-skill and to strengthen the competencies. The main focus areas of these trainings are – Transfer pricing – Forensic computer, – Forensic accounting – Criminal investigation – Advanced auditing, – Advanced stamp duty – Advanced financial and – Management The last and the most important level of training is the transitional level of training which is imparts to officers with 5 - 2 years of service left. The purpose of this training was to ease the passage into retirement and the topics for this training include, psychological counseling and planning for retirement, employees provident fund responsibilities towards employee’s retirement, nutrition and healthcare management, financial and investment management and business opportunities and second career after retirement. Further, she explained that the academy provides opportunities for further studies in Masters and Doctorate Programs from both local as well as foreign universities. In addition collaboration with foreign organizations such as JICA (Japan International Cooperation Agency), IBFD, IRS and ASEAN in the field of training of tax officials is being actively pursued. She concluded her well structured presentation by stating that the vision of Malaysian Tax Training is to be a learning 25
organization which encourages continuous learning process. In the following Q & A session, it was inquired by Mr. Aqeel Zafar Ul Hassan (RCIT, Karachi) as to how long, the transitional level of training has been in place and the subject which draws the most attention from the trainees. Ms. Noriani explained that this training is being imparted since last five years with the main objective to help the retiring officers in adjusting to new realities and psychological training remains the most favourite topic amongst the participants. She further elaborated that the participants are also given know-how of small cottage industries so as they can explore future business possibilities in those industries. Mr. M. Munir Qureshi inquired about the system of feed back from trainees in place in the Malaysian Tax Academy. Ms. Noriani was ably assisted by Madam Noor Azian Abdul Hamid (Director, MTA) in answering this query. She explained that the trainees at the end of each training were asked about their feed back on trainers through a questionnaire. She further elaborated that they were in the process of developing of questionnaire for structured feed back both from the new offices and their supervisors. Mr. M. Munir Qureshi further inquired about any psychological profiling of officers being done before their actual postings in the field. It was explained that psychological profiling of officers was only done prior to their selection for training. The delegate from Turkey Mr. Fayyaz Yazar in his presentation explained the computerization of tax department in Turkey. The computerization included tax office computerization projects (VEDOP), citizen ID, e-Declaration, Call Centers, Electronic Bank Collection Processing System, Internet Office, Management Information System etc. In tax office automation project (VEDOP) there is a full automation of offices which has increased 26
the productivity and has helped in fight against un-registered economy. There is taxpayer facilitation through e-filing of returns. Similarly tax collection via banks is also facilitated. The e-declaration stores electronic declarations and collects information from data warehouses. The edeclaration commenced in October, 2004 and has been widely accepted in a short time by the taxpayers. The infrastructure is ready for digital signature. The call centers established by the Turkish Govt. were the first call center application in public sector. And serve the important purpose of solving taxpayer problem instantly. Mr. Yazar explained the related concepts of E-government, Internet offices, management information system etc. comprehensively. In the Q & A session, it was inquired as to whether data warehouse was connected to the national data base. It was explained that the data base was fully connected. SESSION-V The last presentation of the day was by the Yemeni delegate Dr. Mohamed S. El-Haj. He expalined that the Yemen Tax Authority was established in 1969. The objective of this authority was to give top priority to development of employees' capabilities and skills and the improvement of their performance. The training imparted includes technical, legal and accounting training. Employees are sent for regular training to Egypt and Syria as well. In 2003 the General administration for training was established replacing the Tax Institute. The training imparted includes determining the training needs, analyzing tasks and determining efficiency problems. The responsibilities of the training authorities includes the following: • Determining the training topics 27
• Preparation of the training material in final form • Determining training methods • Supplying materials
training
equipments
and
• Preparation of trainers He concluded his presentation by emphasizing the need for greater cooperation in the field of tax training amongst memeber countries. No questions were asked by the house at the end of this presentation.
28
Date: 14-03-07. DAY THREE SESSION-VI The session started at 0900 hrs on 14th March, 07. For brain-storming participants were divided into three syndicates for group discussions on different topics: SYNDICATE-I TOPIC:INFRA-STRUCTURAL/HUMAN RESOURCE REQUIREMNTS
S# Name
Country
01 Madam Noraini Mustafa Malaysia 02 Mr. Bushra Mohamed El-Makki Al- Sudan Khalifa 03 Mr. Abdullah Y. Al-Nami Kuwait 04 Mr. Hassan Kaymak Turkey 05 Mr. Lee Niederman USA SYNDICATE-II TOPIC
COURSE DESIGN AND INSTRUCTION METHODOLOGIES
S# Name
Country
01 Al-Haj Mohammad Saeed 02 Mr. Zaid Bin Abdullah 03 Mr. Jalal Eldin Suleman Gibereel Osman 04 Mr. Mohamed Said Bentaouet 05 Mr. Bulent Buyukdigan
Yemen Malaysia Sudan Morocco Turkey
29
SYNDICATE-III TOPIC
SCOPE OF COOPERATION IN TRAINING AMONGST MEMBER COUNTRIES
S# Name
Country
01 Madam Noor Azian Abdul Hamid 02 Mr. Ibrahim Mohamed El-Hassan Ibrahim 03 Mr. Muhammad W. Al-Wasmi 04 Mr. Omar Al Madani 05 Mr. Fayyaz Yazar
Malaysia Sudan Kuwait Morocco Turkey
BRAIN STORMING SESSION Chairperson Mr. Fayyaz Yazar, Chief Tax Inspector, Turkey Co-Chairperson Mr. Mahmood Alam, Director General of Training (Customs, Sales Tax & Federal Excise), CBR Rapporteur Dr. Yasmin Fatima, Deputy Director, DOT, Lahore The brain-storming sessions started at 1130 hrs. Presentations were given by the syndicates on the topics assigned to them. The sessions being highly interactive had to be extended. The Noraini El-Makki Al-Nami, and Mr.
first syndicate comprising Madam Mustafa, Malaysia, Mr.Bushra Mohamed Al-Khalifa, Sudan, Mr. Abdullah Y. Kuwait, Mr. Hassan Kaymak, Turkey, Lee Niederman from USA. Mr. Lee 30
Niederman lead the syndicate. The participants discussed and made recommendations on the topic of “INFRA-STRUCTURAL / HUMAN RESOURCE REQUIREMENTS”. The second syndicate comprises of Al-Haj Mohammad Saeed, Yemen, Mr. Zaid Bin Abdullah, Malaysia, Mr. Jalal Eldin Suleman Gibereel Osman, Sudan, Mr. Mohamed Said Bentaouet, Morocco, Mr. Bulent Buyukdigan from Turkey. Mr. Zaid Bin Abdullah lead the syndicate. After discussions recommendations on the topic of “COURSE DESIGN AND INSTRUCTION METHODOLOGIES” were made. Madam Noor Azian Abdul Hamid from Malaysia lead the third syndicate which comprised of Mr. Ibrahim Mohamed El-Hassan Ibrahim, Sudan, Mr. Muhammad W. Al-Wasmi, Kuwait, Mr. Omar Al Madani, Morocco, Mr. Fayyaz Yazar from Turkey and they made recommendations on the topic of “SCOPE OF COOPERATION IN TRAINING AMONGST MEMBER COUNTRIES”. All presentations were very precise and comprehensive, they covered all aspects of the given topics. Director General D.O.T. Mr. M. Munir Qureshi discussed the recommendations in his closing address of the conference.
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HEADS OF DELEGATIONS COUNTRY
Head of Delegation
MALAYSIA
Madam Noor Azian Abdul Hamid Director Malaysia Tax Authority
MOROCCO
Mr. Omar Al Madani Head of Multilateral Co-op Unit
SUDAN
Mr. Ibrahim Mohamed ElHassan Ibrahim Head of Training Administration
YEMEN
Al-Haj Mohammad Saeed Yemen Tax Authority
TURKEY
Fayyaz Yazar Chief Tax Inspector
APPROVALS’ SIGNATURE
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ATAIC Association of Tax Authorities of Islamic Countries Conference of Heads of Training Institutions (Direct Taxes)
Part – III APPENDIX March 12–14, 2007
Conference Proceedings as Recorded by the Rapporteurs Venue: DOT Complex, Lahore, Pakistan.
ASSOCIATION OF TAX AUTHORITIES OF ISLAMIC COUNTRIES (A.T.A.I.C)
Conference of Heads of Training Institutions.
ADDRESS BY MUHAMMAD MUNEER QURESHI, DIRECTOR GENERAL (DOT).
Directorate General of Income Tax (Training & Research), Sutluj Block, Allama Iqbal Town, Lahore, Pakistan.
12th to 14th March 2007. 1
Ladies and Gentlemen! AssalamoAlaikum! On my own behalf & on behalf of Dot faculty & the Chairperson ATAIC, Mr M Abdullah Yusuf, who is also the Secretary General Revenue Division and the Chairman of the Central Board of Revenue, I welcome all our distinguished guests and especially the distinguished foreign delegates,
to the first
Conference of ATAIC Heads of Taxation Training Institutions. Mr M Abdullah Yusuf, who has been the driving force behind this Conference, is represented here today by the Member Direct Taxes, CBR, Mr Salman Nabi. Much as Mr M Abdullah Yusuf wanted to welcome you all personally, he is unable to do so because of sudden, urgent and pressing commitments at Islamabad. I am sure you will understand the position and excuse his absence. For those of you who may be mystified by the term
2
‘DOT’ -which word you will be hearing quite a lot today and in the next two days of the Conference, I have to say that this three letter abbreviation is a hangover from the days of past when there used to just a
directorate of training .That is when the acronym ‘DOT’ was born. Today we have the Directorate General of Income Tax responsible for Training & Research. But such is power of language, that the abbreviation ‘DOT’ persists. This institution trains all officer’s of the Income Tax Group -and also under the new dispensation presently in force, all support staff of the income tax deptt- right from the time of their induction into the deptt , the so called ‘pre-service’ Specialized Training Program, up until the time that they become senior supervisors through the continuous capacity building program.
3
For many years after independence in 1947, tax personnel in Pakistan were trained through an informal training process. The Directorate of Training ( DOT) became a separate functional unit in the Income Tax Deptt for the first time in 1954 and was set up in rather ramshackle rented premises at Karachi. It shifted to Lahore in 1973 but moved to it’s present location in 1986 and shortly therafter it’s mandate was enlarged from imparting training to imparting training and conducting research. Recently it has been further enlarged to advise government on fiscal policy issues.
This institution is Headed by a Director General and the DG and all operational and support staff are appointed by the Central Board of Revenue in exercise of powers expressly stipulated in the statute ie the Income Tax ordinance 2001. All appointments are through a competitive selection process and consistent with the organizational reform process currently underway
throughout
the
departments
of
Income
Tax,
4
Customs, Sales Tax and Federal Excise, all personnel so selected are entitled to a special enhanced compensation package of double the basic salary.
As I said DOT moved to it’s present premises in 1986. This is a large campus with a total area of some (15) acres. There is an extended ‘green belt’ of lawns, flower beds,
and a plant
nursery.
Dot is very well equipped in terms of training facilities and physical infra structure . It has 4 state of the art computer labs at the main campus and three additional labs at Karachi and Islamabad where the sub offices are located. All three campuses have networking, internet connectivity
full internal
and all ancillary equipment
including UPS equipment for labs as well as the entire campus, multi media projection and video conferencing.
5
The last time DOT played host to ATAIC group members was in 2005 when a 12 day Workshop on Revenue Forecasting was held.
In Nov 2006, DOT participated in the 3rd Technical Conference on Revenue mobilization organized by the Central Board of Revenue at Islamabad. It was at the end of that Conference that the Chairman CBR, Mr M Abdullah Yusuf’, reminded me with a subtle hint of impatience that a Conference of ATAIC Heads of Training Institutions was long over due. At
DOT
we
did
not
waste
any
time
thereafter
and
ALHAMDULLILLAH today our efforts have borne fruit.
The purpose of holding this conference is to look in-depth at the existing arrangements for training of direct tax personnel in the ATAIC group, to evaluate different options to improve the same and develop a broad consensus on the key issues involved and the best practices in this area.
6
The poor yield from taxation is a feature common to many countries of the ATAIC group. The tax to GDP ratios are well below those achieved in the developed countries where a yield of 20% and above vis a vis GDP is not uncommon. And in the highly developed Scandinavian countries tax to GDP ratios of 40% and above are commonplace.
In the ATAIC group the average aggregate revenue for the entire group comes to just 419.5 bill dollars US which is just 12% of the overall GDP of 3474 billion dollars. Considering that the aggregate revenue includes both tax and non tax revenue, the yield from taxation is certainly very much on the lower side. Needless to say this needs to be improved drastically. Only three countries of the ATAIC group, oil rich Kuwait, Qatar and Iran are able to generate aggregate revenues significantly in excess of their aggregate expenditures.
Revenue mobilization has received due attention at the 3rd ATAIC Technical Conference in Nov 2006 and a broad
7
consensus has emerged with regard to the measures required to improve the Tax to GDP performance.
Revenues are desperately needed to launch effective programs of economic development. Marginal increases in revenue are not sufficient and will not sustain a meaningful program of economic development sufficient to generate growth on a scale necessary to lift the economy on to a new much higher threshold of development. Developing countries, like most members of the ATAIC, have a lot of catching up to do. They lag far behind the developed countries of the world and are saddled with serious problems of poverty, highly skewed & inequitable distribution of income, poor savings, large fiscal deficits and serious population pressures in many countries. Significant Structural change of the economy is required to alter the complexion of the economy from largely agricultural to a healthy mix of agricultural and industrial segments
8
Almost all the ATAIC group members have embarked on a program of tax reform that includes re-structuring and revamping the training establishment. In Pakistan, in 2000, a special Commission set up by government made critical evaluation of the existing tax system and came forth with reaching recommendations for it’s improvement. That the existing system had failed to deliver was evident from the poor yield from taxation, the widespread corruption in the tax deptt and ofcourse endemic tax evasion.
Among the many recommendations made by the Commission was that for major changes in the training establishment set up for tax personnel and for new emphasis on the training of ALL personnel – not just the officer’s.
The need for such drastic change arises from the increasingly complex environment in which tax administrators, world wide are placed. It is no longer simply a matter of raiding a taxpayers premises, getting hold of a ‘duplicate’ set of accounts, putting
9
them to scrutiny and finalizing the assessment of Income of a taxpayer. Many tax evaders today are represented by top flight counsel a great number of whom are experts in their fields of law, accounting, I.T., - what have you. The Balance Sheet gives very little away by way of clues; books of accounts are seemingly meticulously maintained especially in the case of corporate taxpayers wherefrom much of the tax revenue emanates.
Only an expertly trained taxperson can fathom and unravel the intricacies inherent in the layers of complex arrangements that are at the heart of tax evasion – from looking at the tax evader’s computer’s hard disk for secrets cunningly embedded in the magnetic media to the use of complex algorithms to encrypt computer data to the use of code to scramble entries in books of accounts.
Needless to say, only those armed with the expert knowledge to deal with such extraordinary maneuvers can ever hope to
10
succeed in detecting and bringing to tax, systematically concealed income.
And then, there is the underground economy. Vast sums of money are made in the illegal segment of the parallel economy – amounts never disclosed to the taxman. This is the mysterious world of the smuggler, the counterfeiter, the drug dealer. Believe me, nabbing them requires much more than mere knowledge.
Not only are tax personnel required to be trained to detect tax evasion, they are also required to be trained to interact effectively with existing taxpayers many of whom don’t pay due tax not because they are habitual tax evaders but because they are so alienated by the negative mindset and attitude of tax personnel, including their corruption, they find it more convenient to ‘buy off ’ professional tax investigators rather than be bothered by compliance with onerous tax laws.
11
So now a new kind of training is required- training that will not only instill specific skills in tax personnel but also training that will help change attitudes and mindset.
There is also a pressing need to broaden the mental horizon of all functionaries in the service of government. Tax personnel can no longer afford to have a narrow focus. They must understand and appreciate matters other than those directly connected with taxation. Today we live in a highly integrated environment in which most things have some relationship with each other. Thus almost anything can have some bearing on a tax matter and unless we have the mental capability to appreciate such nuances, we will find ourselves unable to function optimally as tax personnel.
Furthermore, there is the recognition that as far as is feasible and practical, training will have to be imparted to personnel from both the direct and indirect tax jurisdictions from a common platform. Where common training is a practical
12
proposition there is little point in having separate training simply because the service labels are different.
So training today is ‘a whole new ball game’, as they say. And to impart training skillfully you need a new breed of trainer. A trainer who is not merely knowledgable but is also capable of developing new approaches to imparting training. A trainer who is ever willing to experiment; to be creative; to innovate. Above all the trainer must be able to inspire his students to put in that extra effort to rise to new heights of achievement. Thus the trainer has to be a good role model over all.
At DOT we are developing a ‘multi-dimensional’ approach to imparting training which will be explained in detail during the conference proceedings. And CBR Audit Wing under the able leadership of Member Audit – a professional accounts manhas
taken a very significant initative in imparting specialist
training at DOT in conducting audit of taxpayers Returns on scientific lines.
13
DOT is in heavy debt to the highly professional CBR leadership presently in place especially the Chairman CBR Mr M Abdullah Yusuf, the Member (Human Resource Management) Mr Muhammad Talha and the Member, Direct Taxes Mr Salman Nabi for the able and inspired guidance and support provided to DOT without which we would not be where we are today. We also have to thank all CBR field formations, all RTO’s, LTU’s & MTU’s, all Income Tax, Customs and Sales Tax personnel wherever deployed for the willing cooperation extended to DOT in the context of preparations for this conference , especially the help extended by Mr Haji Ahmad, DG RTO, Lahore who has gone out of his way in facilitating DOT. In the next few days of this Conference we hope to share our collective knowledge and experience to try and develop new approaches to imparting training more effectively. We are aware that there are some amongst us who have already made considerable headway in developing their training institutions
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both with regard to physical infra structure as well the systems and procedures necessary to train tax personnel effectively. We hope to tap into this existing resource base and utilize it for the mutual benefit of all. Finally we hope to evolve a broad consensus on the major issues involved in training and the best practices in training in the ATAIC group and in keeping with our Islamic identity use this consensus to forge ahead in the comity of nations. I thank you for your patience and sincerely hope that our friends from foreign lands will have a happy and useful stay at DOT. I leave you now with a short quote from the eminent 19th century English man of letters, John Ruskin:
“ Education does not (only) mean teaching people to know what they don’t know; it (also) means teaching them to behave as they don’t behave.” Thank you!
15
ADDRESS BY Mr. SALMAN NABI, MEMBER (DT), CBR
In the name of Allah most beneficent and merciful. DISTINGUISHED DELEGATES OF ASSOCIATION OF TAX AUTHORITIES OF ISLAMIC COUNTRIES, DIRECTOR GENERALS, RTOs, DIRECTOR GENERALS, LTUs, COLLECTORS, OFFICERS & RESPECTED GUESTS! Assalam-o-Alaikum! It gives me great pleasure to welcome you all to Pakistan as well as to this institution of Directorate General of Training & Research [Direct Taxes] of which we are proud of. It has not been very long that a Conference of 3rd Technical Conference of ATAIC was held in November 2006 in Islamabad, which was very successful with regards to building consensus on the problems and issues being faced by the tax authorities in Islamic Countries. We discussed resource mobilization in the region with a special reference to improvement in tax to GDP ratio, tax base broadening, voluntarily compliance and Shariah Taxation (Zakat). It was agreed in the above Conference that considering the shortfall in Govt. Finances in most countries and the consequential recurring fiscal deficit, there was a pressing need to significantly improve the tax to GDP ratio. The Conference, I believe was a great success and bore fruitful results during that very Conference. It was also agreed that for resource mobilization, it is
extremely necessary that every country should have well-trained human resource in the tax department. I am today reminded of the first Technical Conference of ATAIC held in Kuala Lumpur in 2004, where we had suggested the holding of a conference of training heads of member countries. Pakistan had offered to host the conference so that we could share our experience in this regard and sum up with recommendations to generate a competent and dedicated work-force which in turn will contribute in resource mobilization. This offer was reiterated during the proceedings of 2nd Technical Conference held in Tehran (Iran) in 2005. I must compliment Mr. M. Munir Qureshi, who Heads the Directorate General of Training & Research who along-with his dedicated team has worked hard to organize this Conference, and Al-Hamdulilah we are sitting here together to discuss and share our knowledge regarding training and how to improve and modernize our training facilities. Ladies and Gentlemen! Training of the work-force is a key element which determines the efficiency level of tax administration. A well-trained work-force is needed to reduce what is called the “distortionary effect of tax burden� as the economists call it. The following elements of training have to be looked at in detail, to perceive the desired results, i.e., (i)
to define training needs, i.e. training needs analysis;
(ii)
to design training modules;
(iii)
to develop training event, its arrangement and infrastructure to deliver training, i.e., methodology and resource persons; and
(iv)
to evaluate both the trainees and the trainers.
The training being imparted in the Directorate of Training, Lahore conforms to the above target areas of improvement. Al-Hamdulillah, necessary infrastructure and the resources are available at this Directorate along with excellent faculty enabling us to train new entrants to the service as well as to organize Capacity Building Programs of in-service officers successfully. It is hoped that the sharing of training methodologies amongst member countries will pave the way for future cooperation in the form of joint trainings programs resulting in excellence in training. It is the need of hour to develop and to train tax managers with a view to augment resource mobilization in form of increased tax revenues of our Governments. Almost all member countries are faced with fiscal deficits and it is imperative to improve tax collection efforts for attaining self-reliance and economic development. Most of our member Islamic countries are rich in resources yet the dream of national prosperity and economic development eludes many of us. All important national economic indicators point to the need for consolidated efforts for economic
development. Side by side with structural tax reforms needed for growth in the economy, development of quality training institutes is also essential. No reforms initiative can ever succeed without the backing of well trained human resource. Well thought out and planned joint training programs will serve the common goals of skilled and fully trained work-force. In line with cooperation in the field of tax management and training, an ATAIC workshop on Revenue Forecasting was successfully organized in the year 2005 in this Directorate. This twelve day workshop focused on scientific and analytical means of forecasting public revenues of the government. In most underdeveloped countries, future planning often fall victim to wrong estimates of facts and figures. Rather than the traditional method of revenue forecasting based upon percentage increase/decrease with reference to current year’s performance, this method relies on scientific approach to forecasting future revenue streams. The resource person for this conference was a Canadian consultant who followed the micro simulation technique. This conference was extremely beneficial in assisting the participant countries in following a scientific approach in the planning of future economic strategies. Hence workshops and seminars on common issues in the field of tax administration and training need to be regularly organized for mutual benefit of all participants. In this age of globalization, it is not very hard to imagine future trainings being conducted on issues such as forensic accounting and auditing
necessary to detect corporate frauds. I am very pleased to inform you that Pakistan has made an offer to the United Nation Organization also to host a training program in collaboration with them. We are also in touch with Commonwealth Association of Tax Administration. It is hoped that the Director General, once he is over with the current event, will take up the challenge to bring this training institute on the global map by organizing a training program under the umbrella of United Nations. Ladies and Gentlemen! In Pakistan large scale administrative reforms in Central Board of Revenue are underway and one of the basic requirements of these reforms strategies is to impart quality training to the new entrants to the service as well as to the in-service officers. As part of these reforms, the new entrants to the service after completing necessary training at this Directorate are sent to Institute of Banking Administration Karachi, a leading business studies institution in Pakistan, for completion of their one year MBA degree in taxation. An important component of these reforms is the new Income Tax Ordinance, 2001, under which functionalization of our Direct Taxes has been undertaken. To synchronize the new functions of the tax officials with the Income Tax Ordinance, 2001, training on functional lines is being organized with the help of Professional Chartered Accountant Firms. Two independent sessions of integrated audit training modules have so far taken place in February & March, 2007. These sessions were a joint collaboration
between a Chartered Account firm and our Audit Wing. The Directorate of Training fully participated in these training programs in designing the course outlay as well as in providing infrastructural support. This Directorate is therefore, a leading tax training institute having the necessary infrastructure and competent faculty to offer training on above lines to member Islamic Countries. In addition, Lahore is a seat of learning with many eminent world class colleges and universities. Recognizing the potential of this Directorate as a regional training hub, the Central Board of Revenue has principally agreed to offer enhanced compensation packages for outsourcing quality resource persons. As a result of this initiative, DOT is now in a position to offer advanced training courses backed by competent outsourced faculty. The integrated audit training sessions are an example of this initiative. In future, it is hoped that the pace of cooperation between the member countries in the field of technical training will gain further momentum. I invite the member countries to take advantage of this conference and strengthen the bond further by forging cooperation in the field of joint trainings and seminars. There is an urgent need to recognize the need for revamping and improving the skills and knowledge of tax officials and what better way than through sharing of the tax training between the member countries.