MULTAN: The Federal Board of Revenue (FBR) has claimed that sugar sector has witnessed 11 percent growth from Rs29.3 billion a year ago to Rs32.43bn in the first six months of this year.
The Federal Board of Revenue has linked this increase to the introduction of the track-and-trace system (TTS) in November and December disregarding the impact of the increased prices of the commodity on the revenue. The price of sugar is still over Rs100 per kilogram across the country.
FBR claimed the “encouraging outcome” of the digital monitoring of the sugar sector showed that the TTS was contributing significantly to the prevention of revenue loss and resulting in increased profits. The TTS equipment was installed in October and November, and all sugar mills were delivered the paraphernalia along with tax stamps to be affixed on each sugar bag. The FBR had through a sales tax general order notified that no bag of sugar would be allowed to leave a production site or a manufacturing facility without affixation of the stamps and Unique Identification Marking (UIM).
It is pertinent to mention here that Prime Minister Imran Khan formally inaugurated the TTS for the sugar sector on Nov 23. The Inland Revenue Enforcement Network (IREN) was entrusted with the task to combat tax evasion in the sugar sector in order to ensure enforcement of movement of sugar bags with tax stamps. Regional enforcement hubs across Pakistan were tasked with conducting raids on the unstamped/non-tax paid sugar. As a result, all IREN hubs intensified their operations against the supply chain operators to ensure implementation of the TTS in letter and spirit.
Subsequently, the Hyderabad Directorate of Intelligence and Investigation (Inland Revenue) visited various sugar dealers in the city on Nov 27 and found a stock of 172 sugar bags manufactured by M/s Chamber Sugar Mills lying on the premises of M/s Gulzar and Co without tax stamps. The bags were seized by an 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.
The FBR initiated implementation of the TTS in September from the tobacco sector immediately after the vacation of a stay by the Sindh High Court on Aug 20. Keeping in view the approaching crushing season, the bureau decided to implement the system in the sugar sector in order to digitally monitor production by the entire industry.
Site surveys/factory visits were completed by a third party private licensee of the FBR in September and tripartite agreements signed with all the 79 operational sugar mills of Punjab, Sindh and Khyber Pakhtunkhwa in October resulting in 100pc coverage of the sector.
