Digital tax monitoring yields Rs32.43bn from sugar sector

Digital tax monitoring yields Rs32.43bn from sugar sector

ISLAMABAD: The digital monitoring initiated by the Federal Board of Revenue (FBR) has resulted in a collection of Rs32.43 billion from the sugar sector during the first half of the current fiscal year.

The FBR in a statement issued on Friday said that the implementation of the Track and Trace System (TTC) to monitor sugar production had resulted in the collection of Rs32.43 billion during the first six months (July – December) of the current fiscal year 2021/2022.

This reflected a growth of 11 per cent when compared with Rs 29.30 billion collected in the same period last year.

READ MORE: FBR tightens condition for tax stamped sugar bags

This encouraging outcome of the digital monitoring of the sugar sector shows that TTS is contributing significantly to the prevention of revenue loss and resulting in increased revenue collection.

The installation process of TTS equipment was undertaken in October and November 2021 and all the Sugar Mills were delivered applicators along with tax stamps to be affixed on each sugar bag.

FBR through Sales Tax General Order (STGO) No.5 of 2021 had notified that no sugar bags would be allowed to be taken out from a production site or a manufacturing facility without affixation of tax stamps and Unique Identification Marking (UIMs). However, TTS was formally inaugurated by the Prime Minister of Pakistan on November 23, 2021.

READ MORE: FBR bans sugar bags movement without tax stamps

In order to ensure the enforcement of the movement of sugar bags with tax stamps, Inland Revenue Enforcement Network (IREN) was entrusted with the task to combat tax evasion in the Sugar Sector. Regional Enforcement hubs all across Pakistan were tasked to conduct raids on the un-stamped / non-tax paid sugar. As a result, all IREN hubs intensified their operations against supply chain operators to ensure the implementation of TTS in letter and spirit.

In this regard, the Directorate of I&I (IR), Hyderabad visited various sugar dealers in Hyderabad on November 27, 2021 and found a stock of 172 sugar bags manufactured by M/s Chamber Sugar Mills lying in the premises of M/s Gulzar & Co without Tax Stamps.

The same unstamped bags were taken into custody by IREN team which created deterrence in the market. Since then more than 65 raids have been conducted by Regional IREN Hubs of Rawalpindi, Lahore, Faisalabad, Multan, Karachi, Hyderabad, Sukkur, Quetta, and Peshawar in various cities and towns across the country but no sugar bags were found without tax stamps.

READ MORE: FBR announces cash reward to IREN officials for raids

It is pertinent to mention that the Federal Board of Revenue initiated the implementation of the Track and Trace System (TTS) in September 2021 immediately after the vacation of stay by the honorable Sindh High Court on August 20, 2021.

Keeping in view the approaching crushing season, FBR decided to implement TTS in Sugar Sector in order to digitally monitor the production of the entire industry.

The site surveys/factory visits were completed by the FBR’s licensee in the month of September 2021 and Tri-Partite Agreements (TPAs) were signed with all the 79 operational sugar mills of Punjab, Sindh, and KPK in October, 2021resulting in 100 % coverage of Sugar Sector.

Adviser to PM on Finance and Revenue, Shaukat Tarin, has commended FBR for the successful implementation of this innovative digital intervention, resulting in a sizeable increase in tax revenue. Likewise, Chairman FBR/Secretary Revenue Division, Dr.Muhammad Ashfaq Ahmed has appreciated the outstanding performance of IREN squads in ensuring the desired compliance by the Sugar Sector which has started paying dividends.

He further added that TTS was one of the key interventions introduced by FBR to push its ongoing drive for digitization to achieve transparency and thereby maximize tax compliance.

READ MORE: PM Imran launches tax monitoring ‘track, trace’ system

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