KARACHI – In a decisive move to tighten tax compliance within Pakistan’s rapidly expanding renewable energy sector, the Federal Board of Revenue (FBR) has deployed its officers to monitor the sales activities of leading solar energy companies.
This targeted action, authorized under Section 40B of the Sales Tax Act 1990, is aimed at curbing revenue leakage and enforcing transparency in the booming solar industry.
According to an official communication, the FBR has empowered the Chief Commissioner Inland Revenue, Corporate Tax Office Karachi, to station tax officers at the premises of four major solar companies for a period of 30 days. These officers will oversee real-time business operations, focusing on monitoring the sales of taxable goods and verifying stock positions.
The monitoring campaign comes in response to allegations of sales suppression and tax evasion by certain solar companies. Sources revealed that some firms may have been underreporting their sales to avoid fulfilling their sales tax liabilities. The FBR’s latest intervention is a strategic step to verify these claims and ensure strict compliance with tax laws.
“The presence of officers under Section 40B enables the FBR to directly observe and assess business activity, which helps plug loopholes in the system,” said an official familiar with the matter. “The goal is to enhance accountability and transparency in sectors showing rapid growth.”
Pakistan’s solar energy sector has witnessed tremendous growth in recent years, driven by a national push for renewable energy adoption to cut reliance on imported fossil fuels and combat persistent energy shortfalls. While this growth is welcome, it has also led to mounting concerns about tax compliance within the sector.
The FBR’s 30-day oversight initiative is expected to provide a detailed snapshot of how these solar companies conduct their business. Authorities noted that based on the findings, the scope of monitoring could be expanded to include other high-growth sectors that are vital to national revenue collection goals.
With the renewable energy industry under increased scrutiny, solar companies are now under pressure to demonstrate full transparency and adherence to tax regulations—signaling a new era of accountability for Pakistan’s green economy.