Federal Board of Revenue (FBR) has suspended six officials over failure to perform duties to monitoring sugar mills.

This has raised concerns over enforcement discipline in a sugar sector long linked with tax leakages.

The Federal Board of Revenue said the officials were absent from duty despite being formally deployed to oversee sugar production under statutory powers.

In an official statement, the FBR said they had posted officers under Section 40B of the Sales Tax Act, 1990. It mandates real-time monitoring to ensure accurate reporting of production volumes.

The provision also allows tax authorities to station officers at manufacturing units aimed at curbing tax evasion, under-reporting, and manipulation of sales tax liabilities.

The FBR authorities had detected the absence of officials during routine inspections and verification exercises, which were being carried out by the Large Tax Office Lahore.

According to the statement, attendance records and on-ground checks revealed the officials were absent from their designated sugar mills during assigned shifts.

Following the findings, the LTO Lahore immediately recommended suspension and initiation of disciplinary proceedings.

Pakistan’s sugar industry has remained under close scrutiny by tax authorities due to persistent discrepancies in sales data.

According to official data, the sugar sector contributes tens of billions of rupees annually in sales tax and federal excise duties, which calls for effective monitoring critical for revenue protection.

A 2023 internal review by the FBR has estimated revenue losses from sugar sector evasion worth over Rs30 billion annually. It led to tighter surveillance and enforcement measures.

Tax officials say on-site monitoring has helped verify cane crushing volumes, sugar recovery rates, and daily production figures reported by mills.

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The system also feeds data into centralised dashboards being used by the FBR to reconcile production with tax declarations, which manufacturers file.

The sugar industry has also been working in cartels, and therefore, the Competition Commission of Pakistan (CCP) had imposed heavy fines on sugar mills in recent proceedings.

They have not only been plundering money on account of tax evasion, but they have also been looting the consumers by overcharging fees.