Intergrity Management Guide (Final)

Central Board of
Division
Government of Pakistan
INTEGRITY
POLICY DOCUMENT
January 2007
MODERATED AND REPORT COMPILED BY HRM WING

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TABLE OF CONTENTS
Page
Executive Summary 3
Part 1Introduction to the Integrity Development Process: 8
A. General 8
B. Defining Integrity 10
C. The Elements of an Integrity Strategy 11
D. Integrity Development Cycle 12
E. Methodology of the Workshop 13
F. Participants of Workshops 14
Part 2 The Self-Assessment Process: 15
1. Leadership and Commitment 15

2. Regulatory Framework 18
3. Transparency 20
4. Automation 23
5. Reform and Modernization 25
6. Audit and Investigation 27
7. Code of Conduct 30
8. Human Resource Management: 32
8.1 Remuneration and conditions 33

8.2 Recruitment, selection and promotion 34
8.3 Deployment, rotation and relocation 35
8.4 Training and professional development 36
8.5 Performance management/appraisal 37
9. Morale and Organizational Culture 39

10. Relationship with the Private Sector 41
Part 3 The Action Planning Process: 44

Action Plans 44
Integrity Vision Statement 50
Integrity Steering Committee 51
Marketing Strategy 51
Part 4 Action Plan Review, Evaluation and re-development 51
Annexure (A-K) 53-69
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Executive Summary
1. General In view of the tremendous impact, which the integrity of tax collectors
has on the overall legitimacy and ability of the tax collecting institutions to collect the
due taxes, the Integrity Management of the Human Resource cannot be
overemphasized. Recognizing this important aspect of Integrity management of the
workforce, the Secretary General Division/Chairman CBR assigned the task of
consulting the prevalent best practices around the world to HRM Wing for suggesting
policy options.
2. During the course of this task the World Revenue Organizations (WCO) Integrity
Development Guide was found to be most relevant and a professional document, which
serves as a resource material for its member administrations to develop their own
strategies for dealing with integrity issues with due regard for each country’s own unique
cultural and socio-economic environment. The Guide is based on the philosophy of
continuous improvement i.e. by implementing an ongoing cycle of integrity self-
assessment, strategy development and progress evaluation. Though the processes are
designed for Revenue administrations but from view point of usefulness and flexibility
these are practically applicable to all Collecting Agencies and even may serve as a
starting point for such endeavors to all government organizations.
3. Based on the Revised Arusha declaration, the guide focuses on a number of core
issues that are central to the development of an effective and efficient integrity program.
It provides a framework to examine the management, administrative and integrity
strategies currently being employed and to identify opportunities for further
improvement.
4. Keeping in view its adaptation by various administrations of other countries it

was decided to use it as the basic framework for Central Board of ’s Self
assessment/evaluation of its integrity management situation. The integrity development
cycle of the WCO Guide is designed to be undertaken as a group exercise, drawing on
the strengths and experience of a range of people from within the organization, and
where appropriate, from outside the organization. To get the most out of this process it
3
was decided that the “Top Management” of CBR be invited to deliberate the issues.
Accordingly the First Strategic Integrity Management workshop of the TOP
Management was held on 9th and 10th December, 2006 at Bhurban. The following are
some of the key developments arising out of the workshop.
2. Assessment/identification of weak areas of CBR on the 10 Elements. The

participants assessed the prevailing conditions in CBR on the 10 elements of the
Arusha Declaration. This assessment was done through a general vote for the element
(to find out the participants perception) and then through an assessment of the whole
checklist provided with the integrity Development guide. The results are as follows.
Ratings By Participants (By Vote)
S.No Element Very low Low Neutral Good Very
(1) (2) (3) (4) Good (5)
1 Leadership & Commitment 3 7 8
2 Regulatory Framework 3 14
3 Transparency 7 9
4 Reform & Modernization 8 9
5 Automation 1 1 15
6 Audit & investigation 2 11
7 Code of Conduct 1 14
8 HRM (Separately)
9 Morale & Corporate Culture 1 16
10 Relationship with Private 2 6 8
sector
Ratings By Participants of HRM (By Vote)

S.No Element Very low Low Neutral Good Very
(1) (2) (3) (4) Good (5)
1 Remunerations & Condition CBR
2 Recruitment, Selection & CBR
Promotion
3 Development, Rotation & CBR
Relocation
4 Training & Professional CBR
Development
5 Performance CBR
Management/Appraisal
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Over all ratings based on calculation for each item of check list
S.No Element Over all rating

1 Leadership & Commitment 3.16
2 Regulatory Framework 2.71
3 Transparency 2.52
4 Reform & Modernization 2.26
5 Automation 2.81
6 Audit & investigation 2.33
7 Code of Conduct 3.13
8 HRM (Separately) 2.73
9 Morale & Corporate Culture 2.52
10 Relationship with Private sector 2.32
Over all ratings for various elements of HRM for each item of check list
S.No Element Over all rating

1 Remunerations & Condition 2.34
2 Recruitment, Selection & Promotion 3.31
3 Development, Rotation & Relocation 2.37
4 Training & Professional Development 2.64
5 Performance Management/Appraisal 2.98
3. Action plans for weak areas and its implementation leadership.

The following action plans and its implementation leadership were decided for its
immediate adoption/approval by Secretary General Division/ Chairman,CBR.
• Formal review of procedures and systems on at least annual basis in

consultation with field formations: (Member Legal in consultation with Member
TP&R)
• Simplification of procedures, facilitation of stakeholders and quick disposal of
complaints and regular surveys to seek feedback of stakeholders. (Member
FATE, Member FR&S and Reps of line members)
• Effective and comprehensive internal controls should be tested and put in place
to prevent corruption. Information should be obtained and analyzed to identify
trends, opportunities, vulnerabilities with a view to improvement. (Member Audit,
DGs I&A, DG I&I & reps of line members).
• Automation of Business processes and systems as per international standards to

be reviewed by an external independent agency. ( Member TP&R, Member IMS,
Member FR&S)
• Development of codes of conduct for the private sector, which will clearly set out
standards of professional behaviour. (Member FATE & Reps of Line Members)
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• Appropriate result-focused performance standards and indicators to be
established and regularly monitored. (Member FR&S and reps of other wings)
• Reactivate Cabinet Committee on Financial Reforms. (Chairman)
• Revise/Improve Code of Conduct (Member HRM)
• Regular meetings with field officers/staff to educate them on integrity & reforms
(All Members & Communication Specialist).
4. Development of Integrity Vision Statement
At the end of the conference the participants worked on developing an integrity vision
statement for the CBR. The statement was unanimously developed and accordingly
submitted for the approval of the Secretary General Division/Chairman CBR.
A copy of the CBR Integrity Management Policy Statement signed by all the Members of
the Board and the respective DGs is reproduced below.
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4. Integrity Steering Committee.
The conference also approved an integrity steering committee which will oversee the
implementation of the above mentioned action plans. The committee was further tasked
to develop a charter of its functions and steer the integrity vision and management of
CBR. The composition of the committee is as follows:-
• Member Direct Taxes

• Member Sales Tax & Federal Excise
• Member Revenue
• Member HRM
• Member Admin
• DG Intelligence & Investigation
• DG Audit & Inspection (Direct taxes)
• DG Audit & Inspection (Indirect Taxes)
MARKETING STRATEGY
In order to ensure that the results of the self-assessment and action planning process
are well understood and accepted by the executive and embraced by the majority of the
organization’s staff, the following marketing strategy was adopted.
• Involve as many people as possible in the process;

• Secure political and media support;
• Secure private sector support and involvement;
• Sell the real benefits of an improved integrity regime to all staff;
• Gain executive management commitment to the Plan;
• Ensure that those not present at the workshop are not overly suspicious of the
workshop’s outcomes and the rationale behind each of the key elements of the Action
Plan; and
• Ensure that each of the workshop participants maintains an active role in the
implementation of the Action Plan.
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Part 1
INTRODUCTION TO THE INTEGRITY DEVELOPMENT PROCESS
A. General
administrations generally deal with four key issues: collection, community protection,
trade facilitation and protection of national security. To effectively deal with these issues,
a high level of integrity is critical.
2. The adverse effects of corruption within a administration include reduction in

public trust and confidence in government institutions; increased costs of business,
which are ultimately borne by the community; reduction in the level of voluntary
compliance with laws and regulations; leakage; distortion of economic incentives; a
reduction in national security and community protection; and creating an unnecessary
barrier to international trade and economic growth.
3. Though probably some degree of corruption is present in all countries and in all
public institutions, yet the services, because of the scope, nature and complexity of
their work are particularly susceptible to corruption. In order to both minimize the
negative consequences of corruption and to further develop and maintain public trust
and confidence, administrations need to address the issue in a logical and systematic
way and develop and implement solutions which are relevant to their needs and which
reflect their unique operating environment.
4. In recent years a significant amount of international attention has also been

devoted to this issue in a number of conferences, declarations and conventions focused
on the issue of administrative corruption, attempting to identify the problem of corruption
and set out a range of standards and practices considered necessary to deal with it.
From services point of view, three declarations: the WCO’s 1993 Arusha Declaration;
the 1994 Columbus Declaration; and the 1997 Lima Declaration set forward a range of
Revenue-related recommendations. Additionally, the OECD, the Organization of
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American States, the European Union, the United Nations, the World Bank and
Transparency International have focused their attention on administrative corruption.
5. In November 2001, the President of Pakistan approved the Strategy Document of

CBR’s Tax Administration Reform Project (TARP). The vision of the CBR’s Reforms
Programme is to transform CBR into a modern, progressive, effective, autonomous and
credible organization for optimizing by providing quality service and promoting
compliance with tax and related laws. The mission comprised of enhancing the
capability of the tax system to collect due taxes through application of modern
techniques, providing taxpayer assistance and by creating a motivated, satisfied,
dedicated and professional workforce. Emphasis was also placed on values which
included integrity, professionalism, teamwork, courtesy, fairness, transparency and
responsiveness.
6. In view of the tremendous impact, which the integrity of tax collectors has on the
overall legitimacy and ability of the tax collecting institutions to collect the due taxes, the
Integrity Management of the Human Resource cannot be overemphasized. Recognizing
this important aspect of Integrity management of the workforce, the Secretary General
Division/Chairman CBR assigned the task of consulting the prevalent best practices
around the world to HRM Wing for suggesting policy options.
7. During the course of this task the World Revenue Organizations (WCO) Integrity
Development Guide was found to be most relevant and a professional document, which
serves as a resource material for its member administrations to develop their own
strategies for dealing with integrity issues with due regard for each country’s own unique
cultural and socio-economic environment. The Guide is based on the philosophy of
continuous improvement i.e. by implementing an ongoing cycle of integrity self-
assessment, strategy development and progress evaluation. Though the processes are
designed for Revenue administrations but from view point of usefulness and flexibility
these are practically applicable to all Collecting Agencies and even may serve as a
starting point for such endeavors to all government organizations. Based on the
Revised Arusha declaration, the guide focuses on a number of core issues that are
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central to the development of an effective and efficient integrity program. It provides a
framework to examine the management, administrative and integrity strategies currently
being employed and to identify opportunities for further improvement.
8. The nature of corruption and developments in the field of integrity, are constantly
changing and accordingly there is a growing body of knowledge and experience that
authorities can draw on to further develop their integrity strategies. However the WCO
guide contains a wealth of time tested checklists, which are very relevant to the task in
hand. Moreover keeping in view its adaptation by various administrations of other
countries it was decided to use it as the basic framework for Central Board of ’s Self
assessment/evaluation of its integrity management situation.
9. The integrity development cycle of the WCO Guide is designed to be undertaken

as a group exercise, drawing on the strengths and experience of a range of people from
within the organization, and where appropriate, from outside the organization. To get the
most out of this process it was decided that the “Top Management” of CBR be invited to
deliberate the issues.
10. This present paper is based on the proceedings of the First Strategic Integrity
Management workshop of the TOP Management which was held on 9 th and 10th
December, 2006 at Bhurban based on the aforesaid framework of WCO.
B. DEFINIG INTEGRITY
At the outset, an appreciation of the implications of the terms “corruption” and “integrity”
is imperative.
2. There is no universally agreed definition of corruption. However, most useful

definitions focus on three key themes, namely:
• The departure from, or contravention of, public duty;

• The provision or receipt of some form of improper inducement; and
• An element of secrecy.
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3. Thus for an act to be considered corrupt, it usually needs to involve the
contravention of public duty, the receipt of some form of improper inducement, and it
needs to occur in an environment of secrecy, or at least without official sanction. At the
same time, there are many specific behaviours and combinations of behaviours, which
are generally regarded as corrupt. These typically fall under three broad headings:
bribery, nepotism and misappropriation.
4. In recent times, however, the focus of anti-corruption efforts has expanded to

incorporate the more positive aspects of integrity development as well. For example,
some administrations have redefined the concept of integrity to not only include
combating abuse of power or corruption but also conforming to a standard in service
performance such as service standards or client charters. In many administrations, the
concept of integrity now means delivering services to meet the expectations of
taxpayers and stakeholders.
Integrity therefore can be defined as:
“A positive set of attitudes which foster honest and ethical behavior and
work practices”.
In other words, integrity is more than simply the absence of corruption. Rather, it
involves also the developing and maintaining a positive set of attitudes and values,
which give effect to the organization’s aims, objectives, and the spirit of its integrity
strategy.
C. THE ELEMENTS OF AN INTEGRITY STRATEGY
The Arusha Declaration (Revised) is the hallmark of the commitment of international

Revenue community towards good governance and integrity in Revenue.
2. The ten elements outlined in the (Revised) Arusha Declaration provide the most
practical basis for the development and implementation of a range of integrity or anti-
corruption strategies relevant to the operating environment. These elements are:
1. Leadership and Commitment

2. Regulatory Framework
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3. Transparency
4. Automation
5. Reform and Modernization
6. Audit and Investigation
7. Code of Conduct
8. Morale and Organizational Culture
9. Relationship with the Private Sector
10. Human Resource Management
D. INTEGRITY DEVELOPMENT CYCLE
The Integrity Development Cycle comprise of the following phases:-
Phase One:
Assessment phase: to
• Identify the key elements of an effective integrity strategy; and
• Provide a practical guide, or checklist, to assist managers to both assess the

usefulness of their current strategies and to identify areas of future improvement.
Phase Two:
Action Plan phase: To develop an Integrity Action Plan that includes a range of key
integrity development strategies, identifies responsible officials, establishes timelines,
and sets verifiable performance indicators.
Phase Three:
The evaluation phase: This is for administrations that have already undertaken the
integrity self-assessment process and have implemented an Integrity Action Plan. It is
designed to be conducted at least 12 months after implementation of the Integrity Action
Plan has commenced, and is aimed at assisting administrations to:
• Assess their integrity strategies to determine whether they have achieved the
anticipated outcomes;
• Determine where there are areas that require further attention and/or new
initiatives that might be introduced;
• Develop an enhanced Integrity Action
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E. Methodology of the Workshop
The conference was moderated by Mr. Alan Gilmour (HR Advisor to CBR). The
participants which comprised all the Eleven Members of the Central Board of and the
Director Generals of Training and Research (Revenue as well as direct taxes), Director
General Intelligence and Investigation, Director General Post Clearance Valuation,
Directors’ General Audit and Inspection (Direct and Indirect Taxes) were divided into
three syndicates based on their individual competencies (syndicate composition and
the topics assigned are at Annex K). The three syndicates were then given three
elements each from the above mentioned “Elements of Strategy” given in para C. The
syndicates accordingly discussed threadbare the topics assigned to them with the help
of the checklist of initiatives indicated in the Integrity Guide in its direct relevance to
CBR and its business processes. The assessment was made for each item on the scale
of 1-5, with 1 standing for the lowest score and 5 for the highest. The same assessment
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was also made for every topic collectively (Ratings on each checklist are placed as
Annex A-J). The general consensus of the conference was that any individual checklist
item receiving a score of less then 3 needs a priority and accordingly actions were
identified for these along with the timeline for taking corrective action as well as
delegation of implementation responsibility. Due to the relative importance as well as
the overriding impact of HR policies on any integrity situation the HR topic was
discussed/rated separately by all the syndicates collectively.
2. The specific findings of the work shop on each element of Integrity strategy have
been discussed in detail in the next section of this report.
F. Participants of the Workshop
1. Mr. Mumtaz Ahmad, Member (Legal)
2. Mr. Mohammed Talha, Member (HRM)
3. Mr. Salman Nabi, Member (Direct Taxes)
4. Mr. Shahid Rahim Sheikh, Member (Revenue)
5. Ms. Mussarat Jabeen, Member (Sales Tax & Federal Excise)
6. Maj. Gen (Retd) Mohammad Yasin, Member (Administration)
7. Mr. Abdul Razzaq, Member (Audit)
8. Mr. Habib Fakhurrudin, Member (FATE/TP&R)
9. Mr. AAmir Z. Chaudhry, Member (IMS)
10. Dr. Ather Maqsood Ahmad, Member (FR&S)
11. Mr. Munir Qureshi, DG (Training & Research, Direct Taxes)
12. Mr. Mehmood Alam, DG (Training & Research, Revenue, Sales Tax&
Federal Excise)
13. Mr. Usman Khalid Mirza, DG (Audit & Inspection, Direct Taxes)
14. Mr. Sher Nawaz Khan, DG (Audit & Inspection, Revenue, Sales Tax&
Federal Excise)
15. Ms. Razia Sultana, DG (Post Clearence Audit)
16. Maj. Gen (Retd) Fahim Akhtar Khan, DG (Intelligence & Investigation)
17. Mr. Nasiruddin Ahmad, CEO (PRAL)
18. Mr. Imran Ghaznavi, Communication Specialist. (TP&R Wing)
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Part 2
PROCESS OF SELF-ASSESSMENT
1. LEADERSHIP AND COMMITMENT
The (Revised) Arusha Declaration states:
The prime responsibility for corruption prevention must rest with the head of Revenue
and the executive management team. The need for high levels of integrity must be
stressed and commitment to the fight against corruption maintained over the long
term. Revenue managers and supervisors should adopt a strong leadership role and
accept an appropriate level of responsibility and accountability for maintaining high
levels of integrity in all aspects of Revenue work. Revenue managers should
demonstrate a clear and unequivocal focus on integrity and be seen to set an example
that is consistent with both the letter and spirit of the Code of Conduct.
1.1 An effective integrity programs require a high level of management support and
leadership coupled with responsibility. It is important that there are clearly defined
supervision and decision-making structures and obligations. Managers as well as Staff
at all levels must accept an appropriate degree of responsibility and accountability. For
example, a system of accountability could be introduced to make supervisors at least
partly answerable for their subordinates’ misdeeds. Staff at all levels should be
encouraged to identify and report breaches of integrity, including within their own work
team.
1.2 For assessment of this aspect a questionnaire containing checklists (Anex A)

was analyzed by syndicate.
1.3 The checklist for Leadership and commitment as a whole was rated 3.16 (on a
scale of 1 to 5, with 1 being the lowest rating). The syndicate acknowledged the need
for firm commitment at the highest political level to maintaining a high standard of
integrity throughout the civil service and particularly in services. This is particularly
important in a society where corruption is a widespread ‘systemic’ problem, and does
not just involve individual cases.
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1.4 The syndicate expressed satisfaction on the high level of commitment and strong
leadership role being expressed by the Chairman and the senior management team in
the promotion of integrity in CBR.
1.5 It was generally acknowledged that there is bipartisan support for the integrity
program in : politicians are aware of the organization’s integrity efforts: the Government
actively promotes the maintenance of a high level of integrity within the civil service
and/or : the CBR receive adequate resources to allow it to fulfill its functions effectively
and efficiently: all new projects, policies and initiatives are examined to take into
account integrity risks: there is a strategy in place to address the issue of integrity
among the Senior Management Team: in the selection for management positions,
appropriate consideration is given to the personal integrity of the officers: the selection
process takes account of their commitment and ability to implement the CBR’s anti-
corruption policies: supervisors take a strong leadership role for promoting integrity and
leading by example: the Chairman and the Senior Management Team lead by example,
provide leadership and demonstrate an active commitment to the integrity program:
there is proactive and visible leadership on the issue of integrity from the highest levels
of management: and the Chairman actively promotes integrity with external
stakeholders.
1.6 AREAS REQUIRING IMPROVEMENT: However, while there is a satisfactory

level of commitment and proactive promotion of Integrity at the top level of CBR the
following weak areas were identified for suitable augmentation in order to further
improve the situation.
• There is room for improvement on the aspects of supervisors being held
accountable for corrupt practices and malpractice of staff under their supervision:
specifying their responsibility and increasing their competence to undertake this task
and redefining their role to be held accountable.
• Encouraging managers to work with staff to identify any weaknesses and
vulnerabilities in relation to processes and procedures.
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• Holding members of a work team accountable for corrupt practices engaged in by
other members of the work team.
• Providing internal management training programs adequately addressing
management responsibilities for corruption prevention and detection strategies.
• Increasing the level of political support for integrity in : and providing a system in
place to assist managers to identify staff that, by virtue of temporary personal
circumstances, may be vulnerable to corruption and malpractices.
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2. REGULATORY FRAMEWORK
Revenue laws, regulations, administrative guidelines and procedures should be

harmonized and simplified to the greatest extent possible so that Revenue formalities
can proceed without undue burden. This process involves the adoption of
internationally agreed conventions, other instruments and accepted standards.
Revenue practices should be reviewed and redeveloped to eliminate red tape and
reduce unnecessary duplication. Duty rates should be moderated where possible and
exemptions to standard rules be minimized. Systems and procedures should be in
accordance with the International Convention on the Simplification and Harmonization
of Revenue procedures (Revised Kyoto Convention).
2.1 Complex regulations, procedures or administrative guidelines allow corrupt

practices to develop and flourish. Possible strategies to minimize regulation include the
adoption of internationally agreed standards and good practices. A key initiative is the
adoption of risk management principles to ensure that not only the trade and risks are
assessed but diagnostic and preventive mechanisms are also available to identify and
investigate integrity risks within the organization of CBR.
2.2 Questionnaire on Regulatory framework (Annex B) received an overall score of

2.71 indicating a compelling need for improvement. The syndicate agreed that complex
regulations, procedures or administrative guidelines allow corrupt practices to develop
and flourish. However, it also observed that the principles underpinning modern
regulatory frameworks are being adopted in CBR and all efforts are being made to
eliminate corruption including a curbing of monopoly power and official discretion.
2.3 The results on positive note indicate that most of the internationally agreed
standards have either been implemented or they are scheduled for implementation:
systems and procedures are periodically reviewed and/or re-engineered to eliminate red
tape and avoid duplication: changes are based on periodic review and introduced in a
18
transparent manner: when systems and procedures are being reviewed attention is paid
to eliminating the corruption inducing combination of monopoly power, official discretion
and accountability: there are regular representation at interdepartmental level for
promotion of trade and activities: regulations, procedures and legislation, are
transparent and communicated to stakeholders: and the opinion of stakeholders is given
due consideration on whether legislative provisions and procedures are workable and
understandable.
2.4 AREAS REQUIRING IMPROVEMENT: while appreciating the positive aspects

the he syndicate also identified some weak areas, which need to be improved. These
include:-
• Suggestions that application of administrative penalty system needs to be more
simple and straightforward and applied in a consistent manner:
• The organization requires improving a formal system to implement a ‘continuous
improvement’ strategy:
• Risk management needs to be supported by automated systems: and improved risk
management policies and practices need to be in place to identify high-risk areas.
• The staff that performs the functions or procedures involved in the review process
has to be strengthened,.
• A need for close liaison and co-operation with other agencies to ensure that policies
and procedures are coordinated effectively and that opportunities to reduce or
eliminate red tape are explored.
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3. TRANSPARENCY
Revenue taxpayers are entitled to expect a high degree of certainty and predictability
in their dealings with Revenue. Revenue laws, regulations, procedures and
administrative guidelines should be made public, be easily accessible and applied in a
uniform and consistent manner. The basis upon which discretionary powers can be
exercised should be clearly defined. Appeal and administrative review mechanisms
should be established to provide a mechanism for taxpayers to challenge or seek
review of Revenue decisions. Client service charters or performance standards should
be established which set out the level of service taxpayers should expect from
Revenue.
3.1 Transparency is a key issue for all administrations. Increasing accountability and
maintaining an open and honest relationship with taxpayers and all stakeholders is
crucial to maintaining public trust and confidence in the performance of government
functions.
3.2 Any deviations from laws, regulations and discretionary power should be justified
and documented for later review. There should be a capacity for administrative or
judicial review. In the first instance, such review should be made on an internal basis.
However, taxpayers should have access to independent, external review. In developing
or implementing appeal or review mechanisms an appropriate balance should be struck
between the need to make the process inexpensive, timely and accessible and the need
to ensure it is not used inappropriately for frivolous appeals.
3.3 Client service charters are a way of increasing accountability and demonstrating
Government’s commitment to providing quality service to taxpayers. Service standards
should be challenging but realistic and be fully supported by the organization’s systems
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and procedures. A high level of transparency is not an easy task but it is vital to the
development of a comprehensive integrity program.
3.4 The results of assessment for Transparency on the checklist (Annex C) on a

positive note indicate that taxpayers are provided with sufficient accurate, consistent,
accessible and user-friendly information to allow them to meet their responsibilities to .
Mechanisms are in place to report new initiatives, decisions, or changes in legislative
requirements and procedures that may impact upon taxpayers: for access to information
the Customer Help Desks/Call Centers, Information Centers, Industry Consultative
Committees, and displays and signage are being employed: all fees and charges levied
are published in order to allow traders to calculate more accurately the costs involved
in complying with requirements: electronic media is used for dissemination of
information to taxpayers and there are mechanisms in place to interact with the media:
results of performance is made publicly available (i.e. Internet, annual reports etc):
simple processes or systems for seeking advice are being established in order to
provide taxpayers with a degree of certainty and predictability.
3.5 The syndicate noted with satisfaction that electronic media is increasingly being
used for dissemination of information to the taxpayers and now there are mechanisms
in place for regular interaction with media. The syndicate further expressed satisfaction
on the availability of various review and appeal mechanisms (or independent
adjudication) available to taxpayers to seek a review of their tax grievances. However
the overall rating of 2.52 in the sphere of Transparency indicates the compelling need
for improvement too.
3.6 AREAS REQUIRING IMPROVEMENT: Potential weak areas requiring attention,

identified by the syndicate are as following:-
• There is need of easier accessibility of seeking advice/rulings with development of a
library or database of previous decisions.
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• Mechanisms need to be developed and implemented which monitor and evaluate
the organization’s performance against established standards and international best
practices.
• Citizen or service charters for realistic service standards with ability to be supported
by the organization’s systems and resources, require to be developed indicating
clearly the level of service that the taxpayers should be able to expect and displayed
at public as well as work places.
• Once developed the staff would need to be aware of the standards contained in
service charters and those holding service positions would be provided with training
in client service.
• Attention is required to be given to informing taxpayers of their rights when dealing
with and this information needs to be more easily accessible.
• The basis or criteria upon which officials exercise discretionary power needs to be
clearly defined and made publicly available and, where appropriate, the reasons for
decisions should be conveyed to those affected.
• In cases of non-compliance with procedures systems are required to analyze and
determine if the cause is a lack of adequate communication from .
• Suitable controls over procurement procedures and tendering for work need to be
developed.
• Taxpayers may be consulted to determine their information requirements and
preferred media.
• There is a need for a system for monitoring consistency between different offices,
provinces or regions concerning decisions, procedures and information provided.
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4. AUTOMATION:
Automation or computerization of Revenue functions can improve efficiency and
effectiveness and remove many opportunities for corruption. Automation can also
increase the level of accountability and provide an audit trail for later monitoring and
review of administrative decisions and the exercise of official discretion. Where
possible, automated systems should be configured in such a way as to minimize the
opportunity for the inappropriate exercise of official discretion, face-to-face contract
between Revenue personnel and taxpayers and the physical handling and transfer of
funds.
4.1 The Guide suggests that Information and Communication Technology systems
should complement processes that cannot be automated, the design of computerized
systems should ensure that the most vulnerable points in the manual system are not
replicated and that the new system does not simply shift the point of corruption to a part
of the process that is not being automated
4.2 The syndicate noted that whereas CBR has made momentous achievements in
the automation and computerization of its work processes in order to reduce the need
for direct interaction between taxpayers and tax collectors. However with an overall
rating of 2.26 on the Checklist (Annex D) reflects that still a lot requires to be done in the
field of automation.
4.3 The results on positive note indicate that there is adequate separation of tasks
between those officials associated with identifying risk and those officials involved in the
subsequent processes of collection. The opportunity for unnecessary day-to-day
contact between officials and taxpayers has been reduced: there is a program of
developing business partnerships with the business aiming at increasing voluntary
compliance: the automated systems are been designed with elimination of corruption in
mind and appropriate security and firewall provisions are in place to protect the systems
from external misuse. STARR AND STREAM are functional on Sales Tax side. On the
Revenue side, the PACCS will be rolled out throughout the country to replace “ONE
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Revenue” within this year and the Integrated Tax management System, linking all tax
streams is under active evolution.
4.4 AREAS REQUIRING IMPROVEMENT: However, as stated earlier, still there are
certain weak areas which require attention, and which are given as follows:-
• The external consultants and contractors involved in the provision or support of
computer systems, require being subject to security checks.
• Supervision and accountability systems need to be established to monitor
performance.
• The use of on-line transactions supported by self-assessment and audit-based
controls needs to be promoted.
• A comprehensive risk assessment or review is to be conducted to assess the
corruption risk posed by automated systems: processes have to be in place to
ensure that the system is not vulnerable to staff with relevant system knowledge.
• CBR needs to have an on-line action plan supported by an IT security strategy
addressing the risks associated with on-line electronic transactions: the automated
payment systems needs to be firmly established to eliminate or limit the physical
handling and transfer of funds between officials and taxpayers.
• Attention needs to be paid to increasing official supervision and accountability at
those points in the process that cannot be automated.
• The numbers of officials with access to the system’s programming need to be limited
and controlled.
• Access to secure information needs to be strictly controlled, monitored, and regularly
audited to ensure that information is not being viewed for inappropriate or private
purposes: and the appropriate operating procedures to support the use of electronic
transactions have to be developed.
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5. REFORM AND MODERNIZATION:
Corruption typically occurs in situations where outdated and inefficient practices are
employed and where taxpayers have an incentive to attempt to avoid slow or
burdensome procedures by offering bribes and paying facilitation fees. Revenue
administrations should reform and modernize their systems and procedures to
eliminate any perceived advantages that might be obtained through circumventing
official requirements. Such reform and modernization initiatives should be
comprehensive in nature and focus on all aspects of Revenue operations and
performance. The Revised Kyoto Convention provides a sound reference point for
such initiatives.
5.1 Reform and modernization of administration should be based on a

comprehensive diagnosis of needs and be tailored to the individual circumstances and
aspirations of the administration concerned.
5.2 The syndicate noted that reform and modernization process has been in full
swing at the CBR for the last five years and many milestones have been achieved since
then. But with an overall rating of 2.8 on the checklist for Reform & Modernization
(Annex E) the syndicate felt that the process of reforms still needs further augmentation.
5.3 The results on positive note indicate that the CBR’s reform and modernization
process is based on a comprehensive diagnosis of the administration’s capacity needs:
the reform and modernization program is comprehensive in nature and address all the
key functional areas of : due attention has been paid for ensuring active involvement of
key stakeholders, including the private sector and other government agencies: it is
focused specifically on improving integrity and the administrative controls designed to
deter corruption and foster integrity: job design is focused on eliminating the corruption
inducing factors of monopoly power, officer’s discretion and low levels of control or
accountability: performance targets are being set for core processes: the reform and
modernization program focus on the adoption of agreed international standards and
instruments: and the possibilities for electronic data submission have been increased.
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5.4 AREAS REQUIRING IMPROVEMENT: On the weaker notes following was
observed:-
• There is need of more human and financial resources allocation to the reform and
modernization program.
• The staff within the CBR needs to have access to expert advice and assistance
necessary to ensure effective implementation of reform and modernization initiatives
and need to have a stronger sense of ownership and commitment to the reform and
modernization program:
• staff needs to participate in the reform and modernization of their processes:
relevant industries need to be consulted more well in advance of reforms: other
government agencies need to be consulted more and areas of common activity
simplified.
• The reform and modernization process requires including an external review of the
changes and an external audit to ensure that the reform is cost effective and
efficient.
• There is a need of developing a process review mechanism to ensure cyclical
improvement: the processes have to be benchmarked with other administrations.
• Identification of compliant taxpayers is required for fast tracking their transactions
and targeting of risky taxpayers.
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6. AUDI T AND INVESTIGATION
The (Revised) Aretha Declaration states:
The prevention and control of corruption in Revenue can be assisted by the
implementation of a range of appropriate monitoring and control mechanisms such
as internal check programs, internal and external auditing and investigation and
prosecution regimes. Such regimes should strike a reasonable balance between
positive strategies to encourage high levels of integrity and repressive strategies
designed to identify incidences of corruption and to discipline or prosecute those
personnel involved. Revenue personnel, taxpayers and the general public should be
encouraged to report corrupt, unethical or illegal activity and when such information
is provided it should be investigated in a prompt and thorough manner and sources
should be protected. Where large scale or complex investigations are warranted or in
administrations where corruption is widespread there should also be recourse to
independent anti-corruption agencies.
6.1 Mechanisms to detect and prevent corruption are a primary element of any
corruption prevention strategy. Internal and external audits can review processes and
procedures with the aim of focusing on areas that have a high risk associated with their
function. Audits also provide an independent opinion regarding the efficiency and
effectiveness of procedures and controls.
6.2 The organization must have the necessary resources to follow up any information
provided. This may require an internal affairs or investigation capability with sufficient
independence and autonomy to allow it to undertake its investigations. People selected
for such work must be given appropriate training and management support and be free
of any integrity-related suspicions. There should be mechanisms in place to encourage
staff and stakeholders to report corrupt practices, including confidentiality provisions.
6.3 The syndicate deliberating on this issue rated the overall position of audit and
investigation function at 2.33 (Annex F), highlighting the need for improvement.
27
6.4 The results on positive note indicate that effective internal audit and internal
investigation/affairs units and programs are being re-engineered. In the field the
inspections and examinations are subject to regular internal audit, peer review, and/or
independent review. The results of audits are reported and regularly followed up for
review. Special task forces exist to conduct unannounced inspections at high-risk
posts: staff is aware of the positive role of the special task forces and where large-scale
corruption is suspected or alleged, access is available to an independent anti-corruption
investigation authority. The allegations of corruption are followed up and actions are
taken as a result of audit and investigation.
6.5 AREAS REQUIRING IMPROVEMENT: Despite above, the syndicate thought

that much is still desirable on this count. Some areas identified for improvement are as
follows:-
• The role and functions of Audit, Inspection and Intelligence units need to be
promoted within the organization, including procedures for reporting instances of
alleged corruption.
• The people selected to perform Audit, Inspection and Intelligence functions need to
be sufficiently trained, have appropriate powers of investigation and kept at arms
length from the officials they are investigating.
• Sufficient audit program have to be in place to ensure regular review of high-risk
work areas and functions.
• Data obtained from audits and investigations needs to be analyzed to identify trends,
vulnerabilities, and opportunities for improvement: the extent to which major
activities carry an inherent risk of corruption (dealing in cash, approving applications,
etc.) need to be benchmarked and systems have to be put in place to identify and
manage these risks.
• The general control environment (internal controls, audit trails, reporting
relationships, level of staff competence, delegations etc.) require to be more
conducive to maintaining high levels of integrity.
• Records of all high-risk decisions made by officials for later review and audit need to
be kept and taxpayers, the general public and third parties such as banking
28
institutions need active encouragement to report instances of corruption or
attempted corruption.
• Staff has to be made aware of the channels they should follow to report instances of
corruption, while provisions have to be made to enable the staff to report instances
of corrupt activities in a way that bypasses their immediate supervisor or work area,
for example directly to an internal affairs unit.
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7. CODE OF CONDUCT:
The (Revised) Arusha Declaration states
A key element of any effective integrity program is the development, issue and
acceptance of a comprehensive code of conduct, which sets out in very practical and
unambiguous terms the behaviour, expected of all Revenue personnel. Penalties for
non-compliance should be articulated in the code, calibrated to correspond to the
seriousness of the violation and supported by appropriate administrative and legislative
provisions.
7.1 A Code of Conduct describes the standards of behaviour and conduct required of
employees to ensure that the integrity and good reputation of organization is
maintained. An effective code of conduct must describe in very practical and clear terms
the standards of behaviour expected of all officials; and provide a guide to solving
ethical issues for those working in the department and those who have dealings with
officials.
7.2 The Code should be regularly reinforced to staff. Management must lead by
example and take appropriate action when staff falls short of the required standards.
Appropriate conditions of employment, remuneration, and administrative and legislative
provisions must support the practical implementation of the Code and be sufficient to
provide a positive incentive. If a general civil service code exists, care should be taken
to ensure the organizational specific code is complementary but does not replace the
general code.
7.3 The syndicate deliberating on this issue rated the overall position regarding Code
of Conduct matters at 3.13 (Annex G). Although overall it was seen to be encouraging
however, room for improvement was also felt in certain areas.
7.4 The results on positive note indicate that the organization has a formal Code of
Conduct: which provides guidance for dealing with ethical issues that are relevant to the
different types of work carried out by staff. The code of conduct is readily accessible to
all staff, and is periodically promoted within the organization and the staff is required to
30
sign a provision indicating that they have read and understood the Code, and accept its
provisions, obligations and responsibilities. There are appropriate sanctions for non-
compliance with the Code and effective disciplinary measures exist in the form of
legislations such as Establishment code and the Removal from Service Ordinance
(2001). The Code describes management and staff responsibilities in respect to the
collection, storage, maintenance and dissemination of information obtained in the
course of duty: and includes provisions related to the acceptance of gifts, rewards,
hospitality and discounts: staff is required to declare their investments, assets,
indebtedness and possible conflicts of interest. Procedures are also in place to
investigate alleged or suspected breaches of the Code: members of the senior
management team lead by example in a manner that is consistent with the spirit of the
Code of Conduct: and the Code describes the values of the administration in a practical
way.
7.6 AREAS REQUIRING IMPROVEMENT: Following are some areas requiring

improvement.
• It was felt that the new and existing staff needs to be given more extensive training
in the application of the Code.
• Staff should be required to declare any financial problems or hardships they might
be facing and appropriate mechanisms be put in place to provide financial support to
officials facing temporary hardship in order to ensure that they are not tempted to
engage in corrupt practices to overcome financial problems.
• Appropriate mechanisms needs to be devised for the staff to report suspected
breaches of the Code.
• Supervisors and managers have to take appropriate action when staff falls short of
required standards and breaches of the Code need to be fully investigated.
• There is also a need for considering the introduction of a limited amnesty as an
element of the integrity strategy.
• Training through Directorates of Training in the code of conduct needs to be
improved and accelerated with increased frequency.
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8. HUMAN RESOURCE MANAGEMENT:
The implementation of sound human resource management policies and procedures

plays a major role in the fight against corruption in Revenue. Human resource
management practices which have proved useful in controlling or eliminating corruption
in Revenue, include: -
• Providing sufficient salary, other remuneration and conditions to ensure officials

are able to maintain a decent standard of living
• Recruiting and retaining personnel who have and are likely to maintain high
standards of integrity
• Ensuring staff selection and promotion procedures are free of bias or favoritism
and based on the principle of merit
• Ensuring that decisions on the deployment, rotation and relocation of staff take
account of the need to remove opportunities for officials to hold vulnerable
positions for long periods of time
• Providing adequate training and professional development to Revenue personnel
upon recruitment and throughout their careers to continually promote and
reinforce the importance of maintaining high ethical and professional standards
• Implementing appropriate performance appraisal and management systems,
which reinforce sound practices and which foster high levels of personal and
professional integrity
8.1 A key element in any effective integrity strategy or programme is managing the
personal integrity of staff. People management is just as important as the reform of
systems and procedures.
8.2 Human resource policies should not only be aimed at recruiting the right people,
but also improve staff skills, and provide a quality work environment which recognizes
and supports the work efforts of staff. Just as a high standard of work performance and
integrity is expected from staff, staff expects a high level of integrity in the administration
and implementation of associated HR polices and procedures which underpin the work
environment.
8.3 The issues of human resource management will be further discussed under the
following headings:
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• Remuneration and conditions
• Recruitment, selection and promotion
• Deployment, rotation and relocation
• Training and professional development
• Performance management/appraisal
8.1. REMUNERATION AND CONDITIONS
8.1.1 Appropriate conditions of employment and in particular remuneration that can

sustain a reasonable standard of living is extremely important.
8.1.2 Remuneration may in certain circumstances include social benefits such as

health care, housing, and/or incentive payments. Non-monetary rewards such as
transfer, training, travel, praise, and publicity can also be used to encourage positive
behaviour.
8.1.3 Staff facing serious debt problems may be more vulnerable to corruption. When
staffs are identified as facing severe financial difficulties they should receive counseling
and close supervision, and where appropriate, transferred away from high-risk areas.In
the opinion of Syndicate the situation of whole ambit of this area both collectively and
individually needs improvement. With an overall rating of 2.34, it was observed that the
staff does not receive sufficient remuneration to maintain a reasonable standard of
living. Some specific weak areas requiring augmentation are as follows:-
Weak Areas Requiring Improvement
• The remuneration levels for officials are not comparable to similar public/private
sector positions and does not take into consideration the opportunity presented by
work to supplement income through illegal commissions.
• Mechanisms are not available to identify signs of serious indebtedness of staff.
• The reward system and its fair administration scored very low indicating the need for
its fair administration.
• The reward system needs to share the benefits widely amongst all staff that
demonstrate appropriate ethical standards and encourage the development and
34
maintenance of high standards of work performance, rather than only recognizing a
small number of those officials who work in a particular area where seizures and
prosecutions are commonplace.
• The government needs to be made aware of the important role that condition of
service, and in particular, adequate remuneration, plays in maintaining high
standards of integrity.
8.2. RECRUITMENT, SELECTION AND PROMOTION
8.2.1 Recruitment and staff selection procedures should focus on selecting staff on the
basis of incorruptibility as well as academic, professional and/or technical competence.
It should also take into account the characteristics of honesty, dependability, and high
standards of personal behaviour.
8.2.2 Staff selection and promotion should be based on merit. The process should be
objective and immune from interference. Each recruitment or promotion committee
should be composed of independent members selected from different work areas of the
organization. This arrangement can minimize the chance of nepotism and corruption.
8.2.3 Examining previous employment records the element of honesty should be taken
into account when screening potential staff. It may be necessary to use outside
expertise to examine and suggest improvements to internal selection processes and
procedures. This policy is particularly important for positions where the exercise of
discretion is unavoidable and supervision is difficult.
8.2.4 The syndicate showed satisfaction on situation in this area with an overall score
of 3.31 and assigning 3 or more points to all except one question. It observed that the
selection criteria is published and strictly adhered to for all vacancies: it focuses on high
ethical standards as well as job specific knowledge and technical competence: the
appointment and selection process is based on merit. The staff is fully aware of the
selection process and results are communicated promptly: selection committees are
impartial and their members are chosen on the basis that they come from different work
areas. Qualifications are always checked: and the acceptance of the Code of Conduct is
35
a prerequisite for employment. However the extent of tolerance to conflicts of
interest and permission to engage in secondary employment is a weak area,
which requires attention.
8.3. DEPLOYMENT, ROTATION AND RELOCATION
8.3.1 The staffs that have remained in posts for a long period of time are more
vulnerable to corruption. Removing opportunities for such staff to hold vulnerable
positions for long periods of time is an important integrity measure. Decisions on
posting of officials should be based on established objective criteria and the basis for
posting decisions recorded.
8.3.2 Attention should be paid to the design of jobs to ensure that individual officials
are unable to exercise discretionary power without reference to other officials. For
example, in keeping with accepted accounting practice, officials should not be able to
both initiate and certify payments.
8.3.3 In cases where examinations or inspections need to be undertaken, allocation to

individual officials may be made on a random rather than on a commodity, industry or
geographical basis.
8.3.4 The conduct of examinations or inspections can also be subject to regular peer
and independent review.
8.3.5 In the opinion of the conference situation in this area also needs improvement.
With an overall score of 2.37, the participants acknowledged that the working
environment fosters the development of an inappropriate relationship between
staff and taxpayers. The following are some specific areas requiring
improvement.
Weak Areas Requiring Improvement
• The rotation guidelines are not clear and rotation/mobility needs to be more clearly
understood.
36
• Consideration has to be given to a separate rotation scheme for technical positions.
• Rotation policy needs to be enforced fully and subject to independent review.
• Established mechanisms require to be in place to oversee the rotation of staff at
regular intervals and this process needs to be free of bias or favoritism.
• Mechanisms are also required to be in place to ensure suitable control,
accountability and supervision of staff working in vulnerable environment for e.g. at
point of interaction with the public such as passenger and cargo control points.
• Mechanisms are required to prevent prior knowledge that particular officials will
perform particular functions at certain times: and functions segregation in areas that
are vulnerable to corruption is required.
8.4. TRAINING AND PROFESSIONAL DEVELOPMENT
8.4.1 Education and training, both informal and formal, play a major role in the fight
against corruption. This is particularly appropriate when an organization has in place a
formal Code of Conduct. Training should focus on the standards of behaviour expected
of all staff and the mechanisms available to report breaches of the Code. A sense of
group or shared responsibility should be fostered wherever possible.
8.4.2 While on-the-job training is very important, care needs to be taken to ensure it is
both positive and structured and does not inadvertently reinforce certain inappropriate
practices that have developed over time.To maintain the credibility of the informal and
formal training that is provided, it is essential that the content of the training accurately
reflect what is happening on the job.
8.4.3 In the opinion of syndicate, this area also bore a weak situation with an overall
ranking of 2.64. Though the syndicate noticed that the CBR provides formal
professional training and structured on-the-job training for staff covering both general
and specialist skills but a number of specific areas were identified for more concerted
actions. These include:-
37
Weak Areas needing improvement
• All formal training should cover and reinforce the integrity/anti-corruption message
and focus on the standards of behaviour expected of all officials.
• New recruits should specifically be given introductory training regarding integrity
principles/Code of Conduct in the organization.
• On-the-job training should be structured to reinforce the integrity policies of the CBR.
• There should be a program of succession planning to ensure that the administration
does not become over-reliant on a few key individuals.
• The effectiveness of training should be periodically evaluated.
• Responsibilities and accountabilities for corruption prevention and detection should
be clearly identified and understood by all staff and these responsibilities should
include identifying and correcting any behaviour that falls below expected standards.
• The performance management/appraisal system should identify development needs
and reinforce integrity principles.
• Local operating practices should be consistent with the content of formal training
programs.
8.5. PERFORMANCE MANAGEMENT/APPRAISAL
8.5.1 A performance appraisal and management system concerns the day-to-day

management of people and their performance. Performance appraisal is a process
where managers can assess the performance of staff, identify developmental
opportunities, recognize and reward staff for good work, and contribute to the
achievement of an organization’s goals.
8.5.2 Performance appraisal can also provide incentives for model behaviour by
reinforcing the desired workforce characteristics and conduct. Regular appraisal
encourages staff to take responsibility for maintaining high levels of personal and
professional integrity.
8.5.3 The performance appraisal process should be linked to a comparable reward

system. This may include salary advancement, as well as non-monetary rewards such
38
as transfer, training, travel, praise, and publicity to further encourage positive behaviour.
Such rewards may recognize immediate good performance, however the appraisal
system should be designed with the aim of optimizing staff performance in the long
term.
8.5.4 Performance appraisal should be undertaken on a regular basis. Management

should be accountable for the performance of their staff and actively manage
performance issues.
8.5.5. With an over all score of 2.98, situation in this area was found by the syndicate,
to be hanging in balance with a set of almost equal strong and weak points. It was noted
that although a customary annual reporting system is in place (which is undertaken on a
regular basis) with demonstration of a high level of personal and professional integrity
specifically included as an appraised quality, but a CBR specific performance appraisal
system is a prerequisite for management of its HR on modern lines.
AREAS REQUIRING IMPROVEMENT:

• The syndicate observed that the reward system needs to be linked more closely to
the performance appraisal system which needs to be more fairly administered and
regularly monitored and reviewed.
• The reward system should share the benefits widely amongst all staff that
demonstrate appropriate ethical standards and encourage the development and
maintenance of high standards of work performance, rather than only recognizing a
small number of those officials who work in a particular area where seizures and
prosecutions are commonplace.
• The performance appraisal system should link performance to the CBR's Code of
Conduct and staff should have the opportunity to challenge their performance
assessment if they disagree with any aspect of their appraisal.
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9. MOR ALE AND ORGANIZATIONAL CULTURE:
Corruption is most likely to occur in organizations where morale or ‘esprit de corps’ is

low and where Revenue personnel do not have pride in the reputation of their
administration. Revenue employees are more likely to act with integrity when morale is
high, where human resource management practices are fair and where there are
reasonable opportunities for career development and progression. Employees at all
levels should be actively involved in the anti-corruption program and should be
encouraged to accept an appropriate level of responsibility for the integrity of their
administration.
9.1 Before organizational change can occur, it is firstly necessary to understand the
culture and practices that currently exist within the administration and determine the
most appropriate methods for achieving real and sustained improvement. The extent of
the changes necessary must be based on the administration’s current situation and its
capacity to appropriately support and embrace the necessary cultural change.
9.2 Changes in attitude and organizational culture are extremely difficult to achieve,
particularly when corruption is widespread or endemic. Without change, however, even
if those guilty of corrupt behaviour are replaced, corruption may occur with their
replacements. Improving organizational culture in a way that staff has pride and loyalty
in the service is vital for breaking this cycle. For this purpose, staff and staff associations
should be actively involved in this process.
9.3 The syndicate assigned an overall score of 2.52 to the questionnaire relating to
morale and organizational culture (Annex I). On the positive note it observed that the
senior management leads by example and demonstrates their commitment to integrity
and fairness through their behaviour and its decision-making which is both open and
transparent. The CBR’s systems and culture recognizes and respects the rights of staff
and the need for fairness in all human resource management matters: staff are
recognized or rewarded for performance and the penalties for corrupt behaviour are
40
also sufficient to deter inappropriate behaviour. However a wide room for improvement
was also identified.
AREAS REQUIRING IMPROVEMENT:

The following are some areas identified by the syndicate as requiring further
improvement:-
• It was felt that staff needs to be more encouraged, recognized, acknowledged or
rewarded for identifying methods by which corruption can occur and for suggesting
improved control mechanisms.
• Special project teams need to be used to develop integrity strategies for their work
areas and all staff needs to have the opportunity to contribute.
• Activities are required to be undertaken to measure levels of morale, such as staff
surveys to gather feedback and provide suggestions.
• Mechanisms need to be available in which staff can raise, discuss and resolve any
cultural and/normal issues which impact on the CBR’s anti-corruption efforts.
• Meetings and staff journals are required to be used to communicate the standards of
behaviour expected, reporting instances of meritorious behaviour, and exposure of
those found to be involved in corruption.
• Internal communication mechanisms need to be developed to discuss integrity and
ethical issues and cases of corruption openly.
• Prompt action needs to be taken against those who fail to meet integrity standards
and more effective legislation needs to be in place that protects staff who report
breaches of integrity.
• Staff at all levels needs to be encouraged to identify and report breaches of integrity
and the staff that comes forward to report corrupt practices should be rewarded
rather than victimized.
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10. RELATIONSHIP WITH THE PRIVATE SECTOR:
Revenue administrations should foster an open, transparent and productive relationship

with the private sector. Client groups should be encouraged to accept an appropriate
level of responsibility and accountability for the problem and the identification and
implementation of practical solutions. The establishment of Memoranda of
Understanding between Revenue and industry bodies can be useful in this regard.
Likewise, the development of codes of conduct for the private sector, which clearly set
out standards of professional behaviour, can be useful. Penalties associated with
engaging in corrupt behaviour must be sufficient to deter client groups from paying
bribes or facilitation fees to obtain preferential treatment.
10.1 It is important to focus attention on the central role that client groups play in
controlling corruption. After all, many forms of administrative corruption require the
active involvement of external partners.
10.2 Performance standards and/or client service charters may provide a useful
starting point and a practical monitoring mechanism. When undergoing a major integrity
program it may be useful to have feedback through client surveys on their perceptions
of service quality and operating effectiveness. This may be in addition to the quantity
and timeliness standards that are measured under a client service charter.
10.3 Liaison committees can provide an important vehicle for administrations to clearly
communicate the standards of behaviour expected of taxpayers. It may be appropriate
to establish a joint organization/client anti-corruption task force to identify practical
solutions and identify corrupt officials. Co-operative mechanisms can be established
with industry groups, to encourage the provision of information to identify unusual or
suspicious activity related to illegal activities such as drug trafficking and money
laundering.
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10.4 Taxpayers, the general public and third parties such as banking institutions and
trade associations can provide potential sources of information about an organization’s
most vulnerable points, or indeed, about actual instances of corruption. Providing
guarantees of anonymity can facilitate the provision of information, as can setting up a
hotline and a complaints and compliments system. Information received needs to be
thoroughly investigated, and it should be clearly apparent that the administration has
responded effectively.
10.5 A comprehensive communication strategy could include setting up Customer

Information centers and hotlines to provide information on all processes and
procedures, information leaflets/official notices, as well as promoting the achievements
of organization via the media. These initiatives need to be well publicized and easily
accessible.
10.7 AREAS REQUIRING IMPROVEMENT: With an overall rating of 2.32 (Annex J),
the syndicate felt that almost the entire ambit of this area needs serious thoughts.
The areas which require augmentations are as follows:-
• All relevant stakeholders and taxpayers need to be identified and their support and
co-operation be obtained.
• The client groups need to accept a share of responsibility for both the problem and
the solution.
• Appropriate consultative mechanisms needs to be established to facilitate
communication and co-operation between and client groups.
• Major client groups need to be involved in the development of CBR’s
administration’s anticorruption strategies.
• Formal co-operative arrangements are required to be established with industry
bodies which can deliberate on all important issues affecting the stakeholders.
• There is a need for development of codes of conduct for the private sector, which
clearly set out standards of professional behaviour.
43
• When corrupt practices are detected involving members of client groups the
taxpayers should be penalized for engaging in such behaviour and the penalties
imposed should be sufficient to deter future violations.
• The taxpayers, the general public and third parties such as banking institutions need
to be actively encouraged to report instances of corruption or attempted corruption.
Mechanisms are required to be in place to report instances of corruption, such as
through hotlines or a complaints and compliments system and these mechanisms
need to be regularly promoted to stakeholders.
• Some form of guarantees/commitments should be provided to taxpayers and third
parties that any information provided will be treated confidentially and these
commitments should be honoured.
• Mechanisms are also required to be in place to investigate information provided to
from third parties: taxpayers should accept their share of responsibility for
maintaining a corruption free environment: and there should be a client
communication strategy to not only provide information to taxpayers, but also
promote the achievements of Division.
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Part 3 – THE ACTION PLANNING PROCESS
The self assessment arrived at in the last section was subsequently prioritized to
ascertain the important opportunities/problem areas that were identified during the
process. The identified areas were prioritized on the basis of the following criteria:
• Importance
• Urgency
• Consequence of failure
• Probability of obtaining executive and staff commitment
• Impact
• National/International obligations
• Ease of implementation
• Cost
3.1 Action Plans
After prioritization action plans were developed by the participants for some of the
high priority areas including a decision for its implementation leadership and
timelines for achieving the desired results. They are as follows:-
3.2 Immediate and most important action Plans and implementation Leaders
1. Formal review of procedures and systems on at least annual basis in consultation

with field formations: (Member Legal in consultation with Member TP&R)
2. Simplification of procedures, facilitation of stakeholders and quick disposal of

complaints and regular surveys to seek feedback of stakeholders. (Member FATE,
Member FR&S and Reps of line members)
3. Effective and comprehensive internal controls should be tested and put in place to
prevent corruption. Information should be obtained and analyzed to identify trends,
opportunities, vulnerabilities with a view to improvement. (Member Audit, DGs I&A,
DG I&I & reps of line members).
4. Automation of Business processes and systems as per international standards to be

reviewed by an external independent agency. ( Member TP&R, Member IMS,
Member FR&S)
5. Development of codes of conduct for the private sector, which will clearly set out
standards of professional behaviour. (Member FATE & Reps of Line Members)
6. Appropriate result-focused performance standards and indicators to be established

and regularly monitored. (Member FR&S and reps of other wings)
7. . Reactivate Cabinet Committee on Financial Reforms. (Chairman)
45
8. Revise/Improve Code of Conduct (Member HRM)
9. Regular meetings with field officers/staff to educate them on integrity & reforms (All
Members & Communication Specialist).
3.3 Syndicate Wise/Topic Wise Detailed action plans
(SYNDICATE A)
Leadership and Commitment
Short Term Measures Long Term measures

1. Change in CBR Act (Rules) Federal Board of Act
2. Reactivate Cabinet Committee on Financial
Reforms (CCFR)
3. Communication plan
4. Implementation Plan
5. Top Leadership to be briefed about the
integrity Policy
6. Superior Judiciary to be briefed
7. Fixed Tenure of Chairman for 5 years
Code of Conduct

1. Formalize/regularize Training • Audit/Inspection authorized to
2. Circulate/disseminate/communicate Code Of Conduct conduct/supervise checks/audit
3. Urdu Translation for lower staff to check implementation.
4. VCDs/media to ensure implementation • Violators of Code Of Conduct to
be de-notified from special pay
• DGs to check & enforce Code
Of Conduct
46
Morale & Organizational Culture

1. Subsidised Transport • Housing/ accommodation
Pick & Drop. • Expansion of CBR House
2. Medical Insurance • CBR Colony at Islamabad
3. CBR Housing Society
• CBR Foundation
4. Training in Decision Making
5. LUMS
6. IBA
7. Participatory Work environment
8. Physical Environment
9. Work ethics
10. Quick Promotion of all levels/eligible
employees
11. Merit/integrity/competency based
promotions(New PMS)
12. Timely completion of PERs
(SYNDICATE B)
Regulatory Framework

1. All the Risk Management Systems for all 1. BPR teams should be
taxes should be supported by automated institutionalized to ensure
systems. continuous improvement at CBR
2. (Quarterly meetings should be held with level.
other concerned government agencies) 2. Risk Management should be
3. Base line surveys of performance developed /applied across all
measurement should be done across all taxes
taxes and then later (yearly) surveys to
compare with the base line to determine
efficiency.
4. The same should be published yearly in
CBR year Book.
47
Transparency
Short Term measures Long Term measures

1. Periodical surveys should be conducted to 1. CBR needs to develop systems for
ascertain the clients’ requirement of ensuring consistency/uniformity in
information. all taxes throughout the country. To
2. Simplified and realistic procurement be executed by each tax wing.
procedures should be devised and 2. Each Wing should develop a Library
implemented. All taxes should devise /Database of decisions (long term
mechanisms to determine that if their lack availability on internet)
of compliance is due to a lack of
communication from the respective
department.
3. Sufficient infrastructure/manpower be
employed to conduct meaningful audit and
investigation.
4. Each Wing should develop a
library/database of decisions.
5. Simplified and realistic procurement
procedures should be devised and
implement.
6. CBR needs to develop a system for
ensuring consistency/ informality in all
taxes through out the country. To be
executed at the CBR by each tax wing.
7. Staff should be trained in the service
charters.
Audit & Investigations

1. Officials should be properly trained to handle Risk based Audit programme should
corruption complaints and CBR to take strong be devised and implemented.
action where gross violation of law and
procedures are established.
2. Data should be obtained and analyzed to
identify trends, opportunities, vulnerabilities
with a view to improvement.
3. Effective and comprehensive internal controls
should be tested to prevent corruption.
4. Decisions should be recorded and archive
created for important decisions.
48
5. Private sector should be encouraged to report
any instances of corruption ensuring its
confidentiality and secrecy.
6. Mechanisms be put in place to encourage
officials to report corruption to the identified
authority.
Syndicate-C
Reform & modernisation

1. Upgrade and Debug 1. Replace with ITMS/PACCS
2. TMS/STMS/ONE REVENUE
3. Implement TMS and STMS 2. Replace with ITMS/PACCS
4. Data cleansing and matching, 3. 100% reliable data base
updating and conversion in
electronic format
5. Conceptualization of DWH 4. Development of DWH
6. Develop Audit trail 5. Fully implement audit trail by ITMS
and PACCS
7. Intensive hands on training of staff 6. Education of personnel in
on IT Systems advanced courses to reach and
sustain a paperless environment
Automation

1. E-filing by tax payers 1. Full implementation
2. CPR generation (Pilot) 2. Full fledged CAP implementation
3. Existing code of conduct of CBR 3. Code of conduct for private sector
employees to be revised and to be developed and implemented
extended in consultation with private sector
4. Education of trade and industry, 4. Seeking political will for effective
sensitizing the need for reciprocity. enforcement.
5. Make a clear distinction between
facilitation for compliant taxpayers
and strict enforcement for non-
compliant taxpayers
49
Relationship with the Private Sector

1. Create ownership and commitment
to the reform thru effective
communication with all stakeholders
2. Identification of further
administrative reforms to deter
corruption and foster integrity
3. Policy reforms –removal of
inconsistencies and anomalies in
relevant laws and business
processes
4. Participation of officers and staff in
the reform and modernization of the
processes
50
3.4 INTEGRITY VISION STATEMENT
At the end of the conference the participants worked on developing an integrity vision
statement for the CBR. The statement was unanimously developed and accordingly
submitted for the approval of the Secretary General Division/Chairman CBR.
A copy of the CBR Integrity Management Policy Statement signed by all the Members of
the Board and the respective DGs is reproduced below.
51
3.5.1 Integrity Steering Committee.
The conference also approved an integrity steering committee which will oversee the
implementation of the above mentioned action plans. The committee was further tasked
to develop a charter of its functions and steer the integrity vision and management of
CBR. The composition of the committee is as follows:-
• Member Direct Taxes

• Member Sales Tax & Federal Excise
• Member Revenue
• Member HRM
• Member Admin
• DG Intelligence & Investigation
• DG Audit & Inspection (Direct taxes)
• DG Audit & Inspection (Indirect Taxes)
3.6 DEVELOPING A MARKETING STRATEGY
In order to ensure that the results of the self-assessment and action planning process
are well understood and accepted by the executive and embraced by the majority of the
organization’s staff, the following marketing strategy is suggested.
• Involve as many people as possible in the process;

• Secure political and media support;
• Secure private sector support and involvement;
• Sell the real benefits of an improved integrity regime to all staff;
• Gain executive management commitment to the Plan;
• Ensure that those not present at the workshop are not overly suspicious of the
workshop’s outcomes and the rationale behind each of the key elements of the Action
Plan; and
• Ensure that each of the workshop participants maintains an active role in the
implementation of the Action Plan.
PART 4 – ACTION PLAN REVIEW, EVALUATION AND RE-DEVELOPMENT
The review, evaluation and re-development process should be undertaken at least 12

months after the Integrity Action Plan has been implemented. It will assist CBR to:
Assess whether they have achieved the outcomes anticipated in the Integrity Action
Plan that has been developed; determine the areas that require further attention and/or
initiatives that might build on the momentum already established. And result into an
enhanced Integrity Action Plan.
The evaluation phase should only be undertaken after both the self-assessment
process and implementation of an integrity action plan have been completed. The
result of evaluation will be a comprehensive integrity gap-analysis that will determine
52
whether the administration needs to revisit certain aspects of the self-assessment
process to develop a revised action plan to further develop the organization’s integrity
program. The review, evaluation and re-development process should involve a second
self-assessment process using the same checklist questions which were used for this
self assessment and are contained as annexure with this report. The answers to the
questions together with an examination of the verifiable performance indicators
identified in the Integrity Action Plan should provide the necessary data upon which to
evaluate the success, or otherwise, of the individual strategies or activities included in
the Action Plan.
Indicators of performance that might prove useful is assessing the success of the
Integrity Action Plan include:
• Results of client/stakeholder satisfaction surveys;

• Number of complaints or allegations against Revenue personnel;
• Number of successful investigations and/or prosecutions for integrity breeches;
• Positive/negative media coverage of integrity in Revenue;
• Reports by international agencies;
• Number and nature of ombudsman complaints;
• Complaints by the traveling public, Revenue brokers or importers;
• Results of internal and external audits;
• Achievement of performance targets/client charter standards; and
• Increase/decrease in operational performance statistics.
Once this review and evaluation process has been completed, it is necessary to
develop a new Integrity Action Plan. The new Plan will include:
• Ongoing activities and strategies that require continued attention;
• A range of activities and strategies that are designed to improve or re-focus elements
that were addressed in the previous Action Plan; and A range of new activities and
strategies.
The revised Integrity Action Plan will include the identification of existing problems or
opportunities for improvement, identified solutions, responsible officials, timelines for
Implementation and verifiable performance indicators. Following this process,
appropriate attention should be paid to ensuring executive endorsement and
commitment to the revised Action Plan and the effective marketing of it to staff and
relevant stakeholders.
53
CHECK LISTS (Annex- A)
LEADERSHIP AND COMMITMENT
S.# Items Rating

1 Does the Government actively promote the maintenance of a high level of
integrity within the civil service and/or specifically? 3.4
2 Is there bipartisan support for the integrity program in ?

3.2
3 Are politicians aware of the organization’s integrity efforts? 3.2
4 Is the Minister responsible for held accountable for the integrity performance
of the organization? 2.4
5 Does the administration receive adequate resources to allow it to fulfill its
functions effectively and efficiently? 3.6
6 Are strategies in place to increase or maintain political support for integrity in

2.4
7 If so, are they effective? 2.2
8 Can they be improved? 4.4
9 Does the CEO actively promote integrity with external stakeholders? 4.4
10 Does the CEO and the Senior Management Team provide leadership and
demonstrate an active commitment to the integrity program? 4
11 Is there proactive and visible leadership on the issue of integrity from the
highest levels of management? 4
12 Does the CEO and the Senior Management Team lead by example? 3.8
13 How does the CEO and the Senior Management Team deal with or respond to
allegations of corruption? 3.4
14 Is there a strategy in place to address the issue of integrity among the Senior
Management Team? 3.4
15 Is there a system in place to assist managers to identify staff that, by virtue of
temporary personal circumstances, may be vulnerable to corruption and 2.4
malpractice?
16 Are managers held responsible and competent to undertake this task?
2.4
17 In selection for management positions, is appropriate consideration given to
the personal integrity of the officer? 3.4
18 Does the selection process take account of their commitment to and ability to
implement the administration’s anti-corruption policies? 3.6
19 Do managers work with staff to identify any weaknesses and vulnerabilities in

relation to processes and procedures? 2.8
20 Do internal management training programs adequately address management
2.4
responsibilities for corruption prevention and detection?
21 Do supervisors take a strong leadership role for promoting integrity and
leading by example? 3.4
22 Is this a requirement of their role and are they held accountable?

2.8
54
23 Are supervisors held accountable for corrupt practices and malpractice
engaged in by staff under their supervision? 2
24 To what extent are members of a work team held accountable for corrupt
practices engaged in by other members of the work team? 2.8
25 Are all new projects, policies and initiatives examined to take into account
integrity risks? 3.2
Overall Rating for leadership & Commitment 3.16
55
(Annex B)
REGULATORY FRAMEWORK
S.# Items Rating
1 Have the principles that underpin the Revised WCO Kyoto Convention been implemented? If
not, is its implementation and ratification of the Convention a high priority and scheduled for 4
introduction in the near future?
2 Have other internationally agreed standards such as the HS Tariff Convention, the WTO
Valuation Agreement, the ATA Carnet Convention/Istanbul Convention and the WTO
Intellectual Property (TRIPS) Agreement been implemented or are they scheduled for 3
implementation?
3 Are systems and procedures periodically reviewed and/or re-engineered to eliminate red tape
and avoid duplication? 3
4
2
If so are the staffs that perform the functions or procedures involved in the review process?
5 Does the organization have a formal system to implement a ‘continuous improvement’ 2
strategy?
6
When systems and procedures are being reviewed is attention paid to eliminating the 4
corruption inducing combination of monopoly power, official discretion and minimal
accountability?
7 Are steps being taken to eliminate or reduce non-tariff barriers (such as quotas, import
licenses, permit etc)? 4
8 Is there regular representation at interdepartmental liaison on the reduction of tariff and non- 3
tariff barriers to trade?
9 Are exemptions, concessions, regulations, procedures and legislation, transparent and
communicated to stakeholders? 3
10
3
Are changes based on periodic review and introduced in a transparent manner
11 Are stakeholders consulted on whether legislative provisions and procedures are workable
and understandable? 3
12
4
Is the authority to approve exemptions limited and strictly controlled?
13 Are appropriate risk management policies and practices in place to identify high-risk
cargo/passengers etc. and allow the speedy clearance of low risk ones? 2
14
Are risk management systems and procedures in place reviewed and aligned to the 2
provisions of the WCO Revised Kyoto Convention?
15
Is the application of any administrative penalty system simple and straightforward and is it 1
applied in a consistent manner?
16 Is risk management supported by automated systems? 1
56
17
Is there close liaison and co-operation with other border agencies to ensure that policies and 2
procedures are coordinated effectively and that opportunities to reduce or eliminate red tape
are explored?
2.
Over All Rating For Regulatory Framework 71
57
TRANSPARENCY
(Annex c)
S.# Items Rating
1 Are clients provided with sufficient accurate, consistent, accessible and user-friendly
information to allow them to meet their responsibilities to ? 3
2 Are mechanisms in place to report new initiatives, decisions, or changes in legislative

requirements and procedures that may impact upon clients ( Client Notices etc.)?
3
3 Is attention given to informing clients of their rights when dealing with ?

2
4 Is this information easily accessible? 2
5 For example, Customer Help Desks/Call Centers, Information Centers, Industry
Consultative Committees, displays and signage 3
6 Use of electronic media for dissemination of information to clients

4
7 Are clients consulted to determine their information requirements and preferred media?
2
8 Are there mechanisms in place to interact with the media?
4
9 Are instances of non-compliance with procedures analyzed to determine if the cause is a
lack of adequate communication from ? 2
10 Is there a system for monitoring consistency between different offices, provinces or regions
concerning decisions, procedures and information provided? 2
11 Have simple processes or systems for seeking tariff classification and valuation rulings
prior to importation been established in order to provide clients with a degree of certainty
and predictability? 3
12 Are these easily accessible (is there a library or database of previous decisions?)
1
13 Is the basis or criteria upon which officials exercise discretionary power clearly defined
and publicly available and, where appropriate, have the reasons for decisions been
conveyed to those affected? 2
14 When a official has exercised discretionary power, are the grounds upon which the
decision was made, required to be documented clearly and retained for later review?
3
58
15 Have appropriate review and appeal mechanisms been implemented to allow clients the
opportunity to seek review or challenge decisions, with the possibility of independent
adjudication if required? If so, are the procedures published and promoted? 4
16 Is there an independent external appeal mechanism in addition to internal mechanisms?

5
17 Have citizen or service charters been developed which clearly state the level of service
clients should be able to expect? If so, are service standards realistic and able to be
supported by the organization’s systems and resources? 1
18 Are service charters displayed in public areas such as airports, cargo inspection areas and
Houses? 2
19 Are staff aware of the standards contained in service charters and are those holding
service positions provided with training in client service? 1
20 Have mechanisms been developed and implemented which monitor and evaluate the
organization’s performance against established standards? 1
21 Are the results of performance made publicly available (i.e. Internet, annual report)?
4
22 Are all fees and charges levied published in order to allow traders to calculate more
accurately the costs involved in complying with requirements? 3
23 Are there suitable controls over procurement procedures and tendering for work?
1
Over All Rating For Transparency 2.52
59
AUTOMATION
(Annex D)
S.# Items Rating
1 Have your automated systems been designed with elimination of corruption in
mind? For example, have all opportunities to reduce the risk of corruption been 3.4
considered?
2 Is there adequate separation of tasks between those officials associated with
identifying risk and those officials involved in subsequent procedures such as 3
cargo inspection and collection the processes of:
collection, -
Risk assessment/target identification and -
Inspection/investigation? -
3 Has a comprehensive risk assessment or review been conducted to assess the
1.8
corruption risk posed by your automated systems?
4 Has the opportunity for unnecessary day-to-day contact between officials and
clients been reduced? 3.2
5 Has the system been designed to minimize the input of data by officials and to
limit the routine requirement for physical presentation of documents to ? 2.8
6 Are appropriate security and firewall provisions in place to protect the systems
from external misuse? 3.2
7 Are processes in place to ensure that the system is not vulnerable to staff with
relevant system knowledge? 2.6
8 Is the number of officials with access to the system’s programming limited and
controlled? 2.8
9 Is access to secure information strictly controlled, monitored, and regularly audited
to ensure that information is not being viewed for inappropriate or private
purposes? 2.8
10 Is staff aware of the need to maintain privacy when dealing with confidential
information? 3
11 When automated systems have been introduced, has appropriate attention been
paid to increasing official supervision and accountability at those points in the 2.8
process that cannot be automated (for example, cargo examination)?
12 Have automated payment systems been established which eliminate or limit the
physical handling and transfer of funds between officials and clients? 2.6
13 If external consultants and contractors are involved in the provision or support of

computer systems, have they been subject to security checks, and have
supervision and accountability systems been established to monitor performance? 1.8
14 Does the administration have an on-line action plan supported by an IT security

strategy addressing the risks associated with on-line electronic trading? 2.4
15 Are standardized data requirements as defined in the WCO data model applied?
2.2
16 Are there appropriate operating procedures to support the use of electronic
trading? 2.8
60
17 Is the use of on-line trading supported by self-assessment and audit-based
controls? 1.2
18 Is there a program of developing business partnerships with business with the aim
of increasing voluntary compliance with electronic commerce requirements? 3
Over All Rating For Automation 2.26
61
REFORM AND MODERNIZATION
(Annex E)
S.# Items Ratings
1 Is the administration’s reform and modernization process based on a
3.50
comprehensive diagnosis of the administration’s capacity needs?
2 Is the reform and modernization program comprehensive in nature and does
it address all the key functional areas of ? 3.00
3 Have sufficient human and financial resources been allocated to the reform
and modernization program? 2.83
4 Does staff within the administration have access to expert advice and
assistance necessary to ensure effective implementation of reform and 2.67
modernization initiatives?
5 Has attention been paid to ensuring the active involvement of key
3.00
stakeholders, including the private sector and other government agencies?
6 Has relevant industry been consulted well in advance of reform? 2.67
7 Does staff have a strong sense of ownership and are they committed to the
reform and modernization program? 1.67
8 Has the reform and modernization program focused specifically on
improving integrity? 3.67
9 Are your administrative controls designed to deter corruption and foster
integrity? 3.33
10 Has job design and redesign focused on eliminating the corruption inducing
factors of monopoly power, officer discretion and low levels of control or 3.50
accountability?
11 Have other government agencies been consulted and areas of common
activity simplified? 2.17
12 Has the reform and modernization process included an external review of
the changes? 2.83
13 Has reform and modernization included an external audit to ensure that the
reform is cost effective and efficient? 1.67
14 Are performance targets being set for core processes? 3.00
15 Have you developed a process review mechanism that will ensure cyclical
improvement? 2.17
16 Does staff participate in the reform and modernization of their processes?
2.17
17 Have processes been benchmarked with other administrations? 2.17
18 Does the reform and modernization program focus on the adoption of
agreed international standards and instruments (for example, the revised 3.33
Kyoto Convention)?
19 Have you increased possibilities for electronic data submission?
3.67
20 Have you identified compliant traders so you can fast track their entries to
enable targeting of risk traders? 2.83
21 Have you considered the post-release collection of taxes and duties? 3.17
Over All Rating For Reform & Modernization 2.81
62
(Annex F)
AUDIT AND INVESTIGATION
S.# Items Rating
1 Have effective internal audit and internal investigation/affairs units and programs been
3
established and appropriately resourced?
2 Are the role and functions of such units promoted within the organization, including
procedures for reporting instances of alleged corruption? 1
3 Are the people selected to perform such functions at arms length from the officials they
are investigating? 1
4 Are they sufficiently trained and have appropriate powers of investigation? 2
5 Is the audit program sufficient to ensure regular review of high-risk work areas and
functions? 1
6 Is any data obtained from audits and investigations analyzed to identify trends,
vulnerabilities, and opportunities for improvement? 2
7 Is the general control environment conducive to maintaining high levels of integrity
(internal controls, audit trails, reporting relationships, level of staff competence, 2
delegations etc.)?
8 To what extent do major activities carry an inherent risk of corruption (dealing in cash,
approving applications, licenses, permits etc.) and what systems have been put in 2
place to identify and manage these risks?
9 Does the audit function ensure that effective and comprehensive internal controls are
in place to prevent corruption? 2
10 Are inspections and examinations subject to regular internal audit, peer review, and/or
independent review? 4
11 Are the results of audits reported and regularly followed up for review? 3
12 Have special task forces been established to conduct unannounced inspections at
high-risk posts? 3
13 Are staff aware of the positive role of the special task forces? 3
14 Are records kept of all high-risk decisions made by officials for later review and audit? 1
15 Where large-scale corruption is suspected or alleged, do you have access to an
independent anti-corruption investigation authority? 4
16 Are clients, the general public and third parties such as banking institutions actively
encouraged to report instances of corruption or attempted corruption? 1
17 Are staff aware of the channels they should follow to report instances of corruption? 1
18 Can staff report instances of corrupt activities in a way that bypasses their immediate
1
supervisor or work area, for example directly to an internal affairs unit?
19 What guarantees/commitments are provided to clients, third parties and staff that any
information provided will be treated confidentially? Are they kept? 2
20 Are allegations of corruption followed up? Does the audit and investigation function
include education and other preventative strategies? 3
21 Are actions taken as a result of audit and investigation 3

22 Are these actions communicated to staff? 3
23 Are sufficient resources available to ensure allegations are fully investigated? 2
Over All Rating For Audit & Investigation 2.33
63
(Annex G)
CODE OF CONDUCT
S.# Items Ratings

1 Does your organization have a formal Code of Conduct? 5
2 Was your organization’s Code developed in consultation with clients, other government
agencies and staff at all levels? 3.4
3 Does the Code provide a range of practical examples and guidance for dealing with
ethical issues that is relevant to the different types of work carried out by staff in ? 3.2
4 Is staff required to sign a provision indicating that they have read and understood the
3.4
Code, and accept its provisions, obligations and responsibilities?
5 Is new and existing staff given training in the application of the Code? 2.4
6 Is the Code readily accessible to all staff and periodically promoted within the
organization? 3.4
7 Does senior management promote the Code with their staff and lead by example? 3.2
8 Do supervisors and managers take appropriate action when staff falls short of required
standards? 2.8
9 Is the Code promoted to clients, especially in relation to acceptance of gifts and tokens,
and appropriate relations with stakeholders? 3
10 Are there appropriate sanctions for non-compliance with the Code? 3
11 Does the Code describe management and staff responsibilities in respect to the
collection, storage, maintenance and dissemination of information obtained in the 3.2
course of duty?
12 Does the Code include provisions related to the acceptance of gifts, rewards, hospitality
and discounts? 3.8
13 Are staff required to declare their investments, assets, indebtedness and possible
conflicts of interest? 4.6
14 Are staff required to declare any financial problems or hardships they might be facing? 2.4
15 Are appropriate mechanisms in place to provide financial support to officials facing
temporary hardship in order to ensure that they are not tempted to engage in corrupt 1.8
practices to overcome financial problems?
16 Do effective disciplinary measures exist in or public sector legislation? 4
17 Are there appropriate mechanisms for staff to report suspected breaches of the Code? 2.6
18 Are there procedures in place to investigate alleged or suspected breaches of the
Code? 3.4
19 Are breaches of the Code fully investigated and the results made available? 2.8
20 Has the introduction of a limited amnesty been considered as an element of the integrity
strategy? 1.4
21 Do members of the senior management team lead by example and model behaviour
that is consistent with the spirit of the Code of Conduct? 3
22 Does the Code describe the values of the administration in a practical way? 3
3
Over All Rating For Code of Conduct .13
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(Annex H)
HUMAN RESOURCE MANAGEMENT
8.1 Remuneration and Conditions

S.# Items Rating
1 Does staff receive sufficient remuneration to maintain a reasonable standard of living? 2.2
2 Are remuneration levels for officials comparable to similar public/private sector
positions? 2
3 Is the government aware of the important role that condition of service, and in particular,
adequate remuneration, plays in maintaining high standards of integrity? 2.9
4 Do remuneration levels for officials take into account the opportunity presented by work
to supplement income through illegal commissions? 2.4
5 Are mechanisms available to identify signs of serious indebtedness of staff? 2.5
6 Is there a reward system and is it fairly administered? 2.5
7 If so, does the reward system share the benefits widely amongst all staff that
demonstrate appropriate ethical standards, does it encourage the development and
maintenance of high standards of work performance, or does it only recognize a small
number of those officials who work in a particular area where seizures and prosecutions
are commonplace? 1.9
2.3
Over All Rating For Remuneration and Conditions 4
8.2 Recruitment, Selection and Promotion
S.# Items Rating

1 Are selection criteria published and strictly adhered to for all vacancies? 3.3
2 Do the selection criteria focus on high ethical standards as well as job specific knowledge
and technical competence? 3.7
3 Is the appointment and selection process based on merit or does it help to know
someone in ? 3.6
4 Are all staff fully aware of the selection process and are results communicated promptly?
3.2
5 Are selection committees selected to ensure they are impartial? 3.7
6 Are members of selection committees chosen on the basis that they come from different
work areas? 3.6
7 What external checks are performed on new recruits (for example background and police
checks, previous employment records, references)? Are references and qualifications
always checked? 3
8 To what extent are conflicts of interest tolerated? Are officials allowed to engage in
secondary employment, and if so, do they have to obtain approval to do so? 2.7
9 Are officials nominating for promotion assessed on merit and their willingness to accept
an appropriate level of responsibility for corruption prevention and promotion of integrity?
Is acceptance of the Code of Conduct a prerequisite for employment? 3
3.3
Over All Rating For Recruitment, Selection and Promotion 1
65
8.3 Deployment, Rotation and Relocation
S.# Items Rating

1 Is staff prevented from holding vulnerable positions for long periods of time?
3
2 Is staff expected to transfer or rotate at regular intervals? 3.1
3 Are rotation guidelines clear and is rotation/mobility a clearly understood condition of
service? 2.1
4 Has consideration been given to a separate rotation scheme for technical positions? 1.9
5 Is the rotation policy enforced and subject to independent review?
1.9
6 Are there established mechanisms in place to oversee the rotation of staff at regular
intervals? Is this process free of bias or favoritism? 2.2
7 Does the working environment foster the development of an inappropriate relationship
between staff and clients? 3
8 If so, what mechanisms are in place to ensure suitable control, accountability and
supervision of staff working in such environment? 1.8
10 At point of interaction with the public such as passenger and cargo control points, are
there mechanisms in place to prevent prior knowledge that particular officials will
perform particular functions at certain times? 2.5
11 Are functions segregated in areas that are vulnerable to corruption? For example is it
possible for an individual official to initiate, check and authorize payments? 2.9
12 Are examinations and inspections allocated on a random basis, rather than on a
commodity, industry or geographical basis? 2
13 Are inspections subject to regular independent review? 2
Over All Rating For Deployment, Rotation and Relocation 2.37
8.4 Training and Professional Development
S.# Items Rating

1 Does the administration provide formal vocational training and structured on-the-job
training for staff covering both general and specialist skills? 3
2 Does all formal training cover and reinforce the integrity/anti-corruption message and
focus on the standards of behaviour expected of all officials? Are new recruits specifically
given introductory training regarding integrity principles/Code of Conduct in the
organization? 2.7
3 Is the on-the-job training structured and positive and does it reinforce the integrity
policies of the administration? 2.8
4 Is there a program of succession planning to ensure that the administration does not
become over-reliant on a few key individuals? 2.1
5 Is the effectiveness of training periodically evaluated? 2.2
6 Are responsibilities and accountabilities for corruption prevention and detection clearly
identified and understood by all staff? Do these responsibilities include identifying and
correcting any behaviour that falls below expected standards? 2.9
7 Does the performance management/appraisal system identify development needs and
reinforce integrity principles? 2.7
8 Are local operating practices consistent with the content of formal training programs? 2.7
2.6
Over All Rating For Training and Professional Development 4
66
8.5 Performance Management/Appraisal
S.# Items Rating
1 Does the administration have a performance appraisal system in place?
3.5
2 If so, is the system fairly administered and regularly monitored and reviewed?
2.7
3 Are performance appraisals undertaken on a regular basis?
3.5
4 Is there a reward system linked to the performance appraisal system?
2.5
5 If so, does the reward system share the benefits widely amongst all staff that
demonstrate appropriate ethical standards, does it encourage the development and
maintenance of high standards of work performance, or does it only recognize a small
number of those officials who work in a particular area where seizures and prosecutions
are commonplace? 2.4
6 Does the performance appraisal system link performance to the administration's Code of
Conduct? 2.6
7 Is demonstrating a high level of personal and professional integrity specifically included
in the performance appraisal process? 3.4
8 Do staff have the opportunity to challenge their performance assessment if they disagree
with any aspect of their appraisal?
2.7
9 Are managers required to take an active role in managing the performance of staff?
3.5
2.9
Over All Rating For Performance Management/Appraisal 8
67
(Annex I)
MORALE AND ORGANIZATIONAL CULTURE
S.# Items Rating
1 Does senior management lead by example and demonstrate their commitment to
integrity and fairness through their behaviour? 3.6
2 Is senior management decision-making open and transparent? 3.8
3 Are staff encouraged, recognized, acknowledged or rewarded for identifying
methods by which corruption can occur and for suggesting improved control 2.6
mechanisms?
4 Are special project teams used to develop integrity strategies for their work areas?
Do all staff have the opportunity to contribute? 1.6
5 Are activities undertaken to measure levels of morale, such as staff surveys to
gather feedback and provide suggestions? 1.6
6 Are mechanisms available in which staff can raise, discuss and resolve any cultural
and/normal issues which impact on the administration’s anti-corruption efforts? 1.4
7 Are meetings and staff journals used to communicate the standards of behaviour
expected, instances of meritorious behaviour, and exposure of those found to be 2.2
involved in corruption?
8 Does the administration’s systems and culture recognize and respect the rights of
staff and the need for fairness in all human resource management matters? 3.4
9 Are staff recognized or rewarded for performance that demonstrates the highest
levels of integrity? 3.2
10 Are internal communication mechanisms used to discuss integrity and ethical
issues? Are cases of corruption discussed openly? 1.6
11 Is prompt action taken against those who fail to meet integrity standards? 2.6
12 Is effective legislation in place that protects staff that report breaches of integrity? 2.6
13 To what extent is staff at all levels encouraged to identify and report breaches of
integrity? 2
14 Are staff that comes forward to report corrupt practices rewarded or victimized?
2
15 Are penalties for corrupt behaviour sufficient to deter inappropriate behaviour?
3.6
Over All Rating For Morale & Organizational Culture 2.52
68
(Annex J)
RELATIONSHIP WITH PRIVATE SECTOR
S.# Items Ratings
1 Have all relevant stakeholders and clients been identified and their support and
co-operation obtained? 2.67
2 Do client groups accept a share of responsibility for both the problem and the
solution? 1.67
3 Have appropriate consultative mechanisms been established to facilitate
communication and co-operation between and client groups? 2.83
4 Have major client groups been involved in the development of your

administration’s anticorruption strategies? 2.17
5 Have formal co-operative arrangements been established with industry bodies

incorporating aspects such as the knowledge of ’ procedures, information
exchange and two-way training? 2.50
6 Has the development of codes of conduct for the private sector, which clearly set
out standards of professional behaviour, been established? 1.83
7 When corrupt practices are detected involving members of client groups are the
clients penalized for engaging in such behaviour? Are the penalties imposed
sufficient to deter future violations? 2.00
8 Do legal provisions appropriately recognize all parties involved in corrupt practices

or do they only cover the officials involved? 3.17
9 Are clients, the general public and third parties such as banking institutions
actively encouraged to report instances of corruption or attempted corruption? 2.33
10 Are mechanisms in place to report instances of corruption, such as through

hotlines or acomplaints and compliments system? Are these mechanisms regularly
promoted to stakeholders? 2.17
11 What guarantees/commitments are provided to clients and third parties that any
information provided will be treated confidentially? Are these commitments kept? 2.33
12 Are mechanisms in place to investigate information provided to from third parties?

2.67
13 Do clients accept their share of responsibility for maintaining a corruption free
environment? 1.67
14 Is there a client communication strategy to not only provide information to clients,
but also promote the achievements of ? 2.50
Over All Rating For Relationship with Private Sector 2.32
69
(Annex K)
Syndicate compositions and topics assigned
Syndicate A Syndicate B Syndicate C

Composition Member (HRM) Member (Revenue) Member (TP&R
Member (ADMIN) Member (Legal) Member (ST&FE)
Member (DT) Member (Audit) Member (IMS)
DG (DOT, Revenue) DG (I&I) Member (FR&S)
DG (A&I, Revenue DG (A&I) DT DG (PCA)
DG (DOT, DT)
Topics/ Leadership& Commitment Regulatory Frame work Reform & Modernization
Checklists Code of Conduct Transparency Automation
Assigned Morale & Corporate Culture Audit & Investigation Relationship with private
sector
70

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Central Board of

MODERATED AND REPORT COMPILED BY HRM WING

Part 1Introduction to the Integrity Development Process: 8

Part 2 The Self-Assessment Process: 15

1. Leadership and Commitment 15

8.1 Remuneration and conditions 33

9. Morale and Organizational Culture 39

Part 3 The Action Planning Process: 44

Annexure (A-K) 53-69

4. Keeping in view its adaptation by various administrations of other countries it

2. Assessment/identification of weak areas of CBR on the 10 Elements. The

Ratings By Participants of HRM (By Vote)

S.No Element Over all rating

S.No Element Over all rating

3. Action plans for weak areas and its implementation leadership.

• Formal review of procedures and systems on at least annual basis in

• Automation of Business processes and systems as per international standards to

4. Development of Integrity Vision Statement

• Member Direct Taxes

• Involve as many people as possible in the process;

INTRODUCTION TO THE INTEGRITY DEVELOPMENT PROCESS

2. The adverse effects of corruption within a administration include reduction in

4. In recent years a significant amount of international attention has also been

5. In November 2001, the President of Pakistan approved the Strategy Document of

9. The integrity development cycle of the WCO Guide is designed to be undertaken

2. There is no universally agreed definition of corruption. However, most useful

• The departure from, or contravention of, public duty;

4. In recent times, however, the focus of anti-corruption efforts has expanded to

C. THE ELEMENTS OF AN INTEGRITY STRATEGY

The Arusha Declaration (Revised) is the hallmark of the commitment of international

1. Leadership and Commitment

D. INTEGRITY DEVELOPMENT CYCLE

The Integrity Development Cycle comprise of the following phases:-

• Provide a practical guide, or checklist, to assist managers to both assess the

1. LEADERSHIP AND COMMITMENT

The (Revised) Arusha Declaration states:

1.2 For assessment of this aspect a questionnaire containing checklists (Anex A)

1.6 AREAS REQUIRING IMPROVEMENT: However, while there is a satisfactory

The (Revised) Arusha Declaration states:

Revenue laws, regulations, administrative guidelines and procedures should be

2.1 Complex regulations, procedures or administrative guidelines allow corrupt

2.2 Questionnaire on Regulatory framework (Annex B) received an overall score of

2.4 AREAS REQUIRING IMPROVEMENT: while appreciating the positive aspects

The (Revised) Arusha Declaration states:

3.4 The results of assessment for Transparency on the checklist (Annex C) on a

3.6 AREAS REQUIRING IMPROVEMENT: Potential weak areas requiring attention,

5.1 Reform and modernization of administration should be based on a

6.5 AREAS REQUIRING IMPROVEMENT: Despite above, the syndicate thought

7.6 AREAS REQUIRING IMPROVEMENT: Following are some areas requiring

The (Revised) Arusha Declaration states:

The implementation of sound human resource management policies and procedures

• Providing sufficient salary, other remuneration and conditions to ensure officials

8.1. REMUNERATION AND CONDITIONS

8.1.1 Appropriate conditions of employment and in particular remuneration that can

8.1.2 Remuneration may in certain circumstances include social benefits such as

Weak Areas Requiring Improvement

8.2. RECRUITMENT, SELECTION AND PROMOTION

8.3. DEPLOYMENT, ROTATION AND RELOCATION

8.3.3 In cases where examinations or inspections need to be undertaken, allocation to

8.4. TRAINING AND PROFESSIONAL DEVELOPMENT

8.5.1 A performance appraisal and management system concerns the day-to-day

8.5.3 The performance appraisal process should be linked to a comparable reward

8.5.4 Performance appraisal should be undertaken on a regular basis. Management

AREAS REQUIRING IMPROVEMENT: