PM orders crackdown on tax evaders, informal economy

July 30, 2026 (MLN): Prime Minister Muhammad Shehbaz Sharif on Wednesday ordered authorities to launch a nationwide crackdown on tax evaders and businesses operating in the informal economy, while directing the Federal Board of Revenue (FBR) to complete the rollout of its digital production tracking system across the manufacturing sector by the end of the year.

Chairing a weekly review meeting on FBR reforms, the prime minister instructed the relevant authorities to identify individuals and businesses involved in tax evasion and initiate strict legal action against them, according to the Ministry of Information and Broadcasting (MOIB).

He also called for the development of a comprehensive, science-based methodology to accurately estimate the tax potential of different sectors of the economy.

Highlighting the impact of digital reforms, Prime Minister Muhammad Shehbaz Sharif said that, for the first time in Pakistan's history, sugar production data fully matched FBR records, describing it as clear evidence that the authority's production tracking system was delivering tangible results.

He commended the efforts of FBR Chairman and his team for improving tax administration through technology.

The prime minister directed the FBR Chairman and senior officials to remain in Karachi during the first week of every month to engage with the business community and address their concerns promptly.

He also instructed the FBR to operationalize digital production monitoring systems by December for the textile, beverages, steel, poultry, edible oil and ghee, and tyre sectors, while emphasizing that appointments and transfers within the tax authority would continue to be made strictly on merit.

Calling for stronger oversight of customs operations, Prime Minister Muhammad Shehbaz Sharif ordered an immediate third-party audit and validation of Customs bonded warehouses to identify and eliminate irregularities.

During the meeting, officials informed the prime minister that the FBR's production tracking system is already fully operational in the sugar, cement, tobacco, tiles and fertilizer sectors. Implementation is in its final stages in five additional industries with an estimated tax potential exceeding PKR 700 billion.

The meeting was further informed that work is underway with nine more manufacturing sectors to introduce digital tracking systems capable of unlocking an additional PKR 560 billion in tax revenue.

Officials also briefed the meeting on ongoing human resource reforms, including merit-based recruitment, internationally benchmarked training programmes, and the introduction of a performance-based reward and accountability framework for FBR officers.

To strengthen transparency, the FBR has appointed 957 third-party auditors, while the recruitment of 280 Goods Evaluators under the Customs faceless system is in progress.

The faceless customs system has reduced cargo clearance times and improved revenue collection.

The meeting was also informed that a newly established Case Scrutiny Committee will help reduce unnecessary tax litigation by assessing cases on merit before they proceed.

Meanwhile, Alternative Dispute Resolution Committees resolved 152 out of 377 applications received through June 2026 within 90 days, facilitating the recovery of PKR 54 billion in tax revenue.

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