New FBR Chief Stresses For Implementation of Track and Trace System

Web Desk — In order to contain massive sales tax evasion in major sectors, Chairman Federal Board of Revenue (FBR) Asim Ahmad has directed the Project Director, (Track & Trace System) to ensure speedy implementation of the track and trace system on tobacco, fertilizers, cement and petroleum products.

Newly appointed FBR Chairman Asim Ahmad presided over a meeting to review the implementaiton of the track and trace system in various sectors. Tax authorities have directed the team of the Track & Trace System to meet the timelines agreed for implementation of the system.

Sources said the FBR would not allow the cigarette manufactures to remove tobacco products from the production site, factory premises or manufacturing plants without affixation of tax stamps/Unique Identification Marking (UIMs) from extended deadline of May 20, 2020.

Two leading cigarette manufacturing companies are under the process of final stage of implementation of the track and trace system whereas one local company has also signed the tripartite agreement with the FBR. Seven local manufacturers have obtained the stay order against the track and trace system and the next date of hearing has been fixed on June 8, 2022.

Sources said that the installation of the machinery has been started at the production lines of the fertilizer manufacturing units. The machinery for installation at the fertilizer plants has been imported and subsequently being installed at different plants. The installation of the machinery would be completed by June 30, 2020. However, the FBR will confiscate fertiliser bags being cleared from production sites, factory premises or manufacturing plants without affixation of tax stamps/ Unique Identification Markings (UlMs) from July 1, 2022.

Innovative digital monitoring system of sugar production has been implemented over 79 sugar mills, having 151 production lines nationwide. The FBR has collected sales tax of Rs 26.5 billion in first four months (i.e. Dec, 21 to Mar, 22) of current sugarcane crushing season against Rs 19.9 billion during the corresponding period in the last crushing season, registering an increase of Rs 6.59 billion (33 percent) growth, sources said.

All sugar mills had to declare their actual crushing and production during the current crushing season. Therefore, as a result of this digital intervention, the sugar mills have produced record high sugar i.e. 7.51 million tons (up to March 24, 2022) as against 5.63 million produced during last crushing season, showing an increase of 34 percent.

The FBR has collected sales tax amounting to Rs 26.5 billion in first four months (i.e. Dec, 21 to Mar, 22) of current crushing season as against Rs 19.9 billion collected during the corresponding period in the last crushing season, registering an increase of Rs 6.59 billion which comes to 33 percent growth.

The system will result in digital monitoring of the large-scale manufacturing and production of these key sectors. Besides, preventing revenue leakages, it will help in minimizing human intervention and thus pave the way for a transparent and reliable tax compliance system across the country, sources added.