ISLAMABAD: Acting on a report received from an intelligence agency, the Federal Board of Revenue (FBR) has sealed two sugar mills in Central Punjab over serious violations of statutory provisions governing the sugar sector.
Based on the same intelligence report, the FBR has also suspended six Inland Revenue officials who were deputed at the concerned mills.
According to the FBR, the enforcement action was taken for violations of Section 40C of the Sales Tax Act, 1990, read with Chapter XIV-B and Chapter XIV-BA, along with Rule 150 ZQZE of the Sales Tax Rules, 2006. These provisions mandate strict monitoring, control, and compliance mechanisms for sugar mills.
The action follows directives issued by Prime Minister Shehbaz Sharif, who instructed the Federal Board of Revenue (FBR), the Federal Investigation Agency (FIA), and the Intelligence Bureau (IB) to take joint action against sugar mills and dealers involved in tax evasion, undocumented sales, hoarding, and unjustified price hikes.
In line with these directives, a formal notification was issued directing the FBR, FIA, and IB to ensure effective prevention of sales tax evasion in the sugar industry. The prime minister has also ordered strict action against sugar mill owners and dealers, including the installation of CCTV surveillance systems to monitor production processes and stockpiling.
According to official sources, the surveillance mechanism is intended to ensure proper payment of general sales tax (GST) and to curb hoarding and price manipulation in the market.
The FBR stated that the action reflects its firm resolve to ensure strict compliance with sales tax laws, particularly in high-risk sectors, and to take decisive measures against persistent non-compliance. The Board emphasized that all enforcement actions are being carried out strictly in accordance with the law, ensuring due process and transparency.
The FBR further reaffirmed its commitment to encouraging voluntary compliance while maintaining strict enforcement against willful violations of tax laws, in line with the government’s zero-tolerance policy against tax evasion.
