Pakistan’s Federal Board of Revenue (FBR) has identified a massive annual sales tax evasion amounting to Rs. 30 billion in the country’s tile manufacturing sector and announced plans to expand camera monitoring across 17 major industries to curb widespread tax fraud. This initiative is part of the FBR’s ongoing efforts to improve compliance, ensure accurate reporting, and boost federal revenues.
FBR Chairman Rashid Langrial, briefing the Senate Finance Committee, revealed that tile manufacturers will now be required to install monitoring cameras at critical points of production, including kilns, packaging units, and entry and exit points. The aim is to track production accurately and reduce the gap between actual output and reported figures. Langrial warned that non-compliance could result in the government shutting down operations of offending companies, underscoring the strict measures being implemented to secure the country’s tax base.
The chairman highlighted that the tile sector has been a significant source of revenue leakage due to under-reporting and inconsistent production data. By installing cameras, the FBR seeks to prevent manipulation of sales records and ensure that businesses contribute their fair share to national revenues. This move aligns with similar measures already deployed in other high-revenue sectors, including sugar and cement.
Langrial noted that camera installations in sugar mills—where government ministers have vested business interests—have already proven effective in improving reporting transparency. The Prime Minister has instructed that all sugar mills remain under continuous monitoring, with this year’s efforts expected to generate an additional Rs. 76 billion from the sugar sector and Rs. 102 billion from cement. For the tile sector, the FBR has revised its plan and will now install four cameras per facility, down from the initially planned sixteen, balancing oversight with operational feasibility.
The announcement also comes amid broader concerns about revenue shortfalls in Pakistan’s economy. While Langrial acknowledged that a potential gap could emerge this month, he clarified that no new tax measures have yet been decided to address the shortfall. The FBR’s focus remains on enforcing compliance through monitoring and digital tracking rather than introducing additional levies at this stage.
Industry experts suggest that such initiatives could serve as a model for digitalization and enhanced accountability across Pakistan’s manufacturing sectors. By leveraging technology to monitor production, the government aims to ensure fair taxation, reduce fraudulent practices, and streamline industrial oversight. Businesses complying with the new requirements may also benefit from clearer reporting standards and reduced disputes with tax authorities.
The FBR’s approach reflects a growing trend in Pakistan toward technology-driven regulatory enforcement, integrating real-time monitoring, data analytics, and automated reporting to strengthen the country’s fiscal framework. With 17 industries slated for camera installation, including tiles, sugar, and cement, the initiative represents one of the most extensive attempts to tackle tax evasion through digital oversight in recent years.
As the project rolls out, the FBR expects a combination of deterrent effects and revenue gains, positioning Pakistan to gradually bridge gaps in industrial tax compliance while supporting transparent business operations across high-value sectors.
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