PM Stresses Decisive Action to Correct “70 Years of Mismanagement” in Tax System

Prime Minister Shehbaz Sharif Tuesday directed the immediate and effective implementation of ongoing reforms in the Federal Board of Revenue (FBR), with a strong focus on digitization and automation of the tax system. The prime minister while chairing a high-level review meeting, emphasized the need for decisive action to correct what he described as “70 years of mismanagement” in the tax system. He stated that while maximum facilitation would be provided to honest taxpayers and businesses, those involved in tax evasion would face strict legal action without any concessions. The prime minister acknowledged the efforts of the FBR and its supporting enforcement agencies in enhancing tax revenue and appreciated their work as commendable. The meeting reviewed the introduction of a National Targeting System aimed at curbing sales tax evasion. This system will use e-tags and digital devices to track vehicles transporting goods and will be supported by an e-Bilty mechanism issued through the FBR’s system. Digital monitoring systems will be installed at major highways and city entry points to reduce smuggling and save time for commuters. The meeting was informed that a Customs Targeting System was also being introduced at ports and airports to automate the monitoring of imports and exports. The system will use artificial intelligence and integrate with domestic and international databases to combat smuggling and tax fraud. The officials also briefed the meeting on plans to train FBR staff on the new systems and outlined a phased roll out beginning with a pilot project in a major city. Sectors such as cement, hatcheries, poultry feed, tobacco, and beverages will come under stricter sales tax surveillance. It added that monitoring mechanisms similar to those used in the sugar industry were being extended to the tobacco, beverage, steel, and cement sectors. The premier directed that all measures be implemented promptly, effectively, and in a sustainable manner.