Non-compliant importers to face stricter customs scrutiny as FBR accelerates digital transformation drive
ISLAMABAD: The Federal Board of Revenue (FBR) has decided to withdraw the green channel facility for importers that fail to integrate with its digital invoicing system, in a significant move to strengthen customs compliance and accelerate the tax authority’s digital transformation agenda.
According to FBR sources, importers that have not completed integration with the digital invoicing platform will no longer qualify for green channel clearance and will instead be routed through the red or yellow channels, where consignments are subject to enhanced customs scrutiny and verification.
A senior FBR official said the measure is aimed at encouraging businesses to comply with the mandatory digital invoicing regime while improving transparency and reducing tax evasion through technology-based enforcement.
To identify non-compliant businesses, the FBR has compiled data on importers whose imports exceeded Rs10 million during the past 12 months. These businesses have been prioritised for integration under the authority’s digital documentation programme.
Official figures show that Pakistan currently has 21,944 sales tax-registered importers. Of these, 11,709 have been enrolled under the digital initiative, while 10,762 have successfully completed integration with the FBR’s digital invoicing system.
The digital invoicing programme forms a central pillar of the FBR’s broader Transformation Plan, which seeks to modernise tax administration, improve documentation of the economy and enhance revenue collection through greater use of digital technologies.
According to the FBR, the transformation initiative has already produced encouraging results. The number of income tax returns filed has increased from 3.7 million to 7.0 million, representing growth of 91.5 percent. During the same period, net tax chargeable rose from Rs1.86 trillion to Rs3.73 trillion.
The tax authority also reported significant gains from technology-driven enforcement measures. Production monitoring in the sugar sector generated an estimated Rs37 billion in additional annual tax collection, while fraudulent sales tax refund claims worth Rs9.8 billion were successfully blocked.
More than 25,000 taxpayers with a combined turnover of approximately Rs39.3 trillion are currently in the digital invoicing implementation pipeline, highlighting the scale of the ongoing documentation drive.
Meanwhile, the value of transactions recorded through POS-registered retailers has increased to Rs2.9 trillion, reflecting broader documentation of retail sales and greater compliance among registered businesses.
The FBR further disclosed that its artificial intelligence-based audit selection system has identified more than 200 cases involving potential tax liabilities of Rs13.3 billion, demonstrating the growing role of data analytics in risk-based tax enforcement.
Tax experts believe the decision to restrict green channel access will encourage more importers to complete digital integration while strengthening customs controls and improving tax compliance. They note that the initiative forms part of the FBR’s wider strategy to create a transparent, technology-driven tax administration capable of reducing revenue leakages and expanding the documented economy.
