Islamabad, October 12, 2026: Prime Minister Shehbaz Sharif has directed the Federal Board of Revenue (FBR) to complete the installation of digital production monitoring systems across major manufacturing industries by December 31, 2026, as part of efforts to improve tax collection and prevent revenue losses.
The directive was issued during a high-level meeting in Islamabad to review progress on FBR reforms, tax enforcement and the government’s strategy to document industrial production.
FBR to Expand Digital Monitoring Across Manufacturing Industries
The prime minister instructed officials to accelerate the installation of automated monitoring equipment and remove obstacles delaying implementation.
The system uses cameras and digital records to monitor production activity at manufacturing facilities. It is intended to help tax authorities compare actual factory output with declared production figures and sales tax records.
Shehbaz Sharif emphasised that businesses collecting taxes from consumers must deposit those amounts into the national treasury rather than retain them unlawfully.
Five Major Industries Already Covered by Monitoring System
During the meeting, officials informed the prime minister that digital production monitoring had already been installed in five major industrial sectors.
These include:
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Sugar
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Cement
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Tobacco
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Tiles
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Fertiliser
Installation is also underway in the textile, packaged drinking water, packaged juice and packaged milk industries, where the required equipment has already been procured.
Government Sets Deadlines for Additional Industries
The FBR has established procurement deadlines for monitoring equipment in several other manufacturing sectors.
| Industry | Equipment procurement deadline |
|---|---|
| Steel | October 15, 2026 |
| Poultry | October 15, 2026 |
| Tyres | October 15, 2026 |
| Packaged tea | October 30, 2026 |
| Household electronics | October 30, 2026 |
| Leather | October 30, 2026 |
| Paper and paperboard | October 30, 2026 |
| Edible oil and ghee | October 30, 2026 |
Officials expect the monitoring systems across the targeted industries to become operational by December 31, 2026.
FBR Reports Rs1.3 Trillion Increase in Tax Collection
During the meeting, officials presented an assessment of the difference between Pakistan’s estimated tax potential and actual revenue collection.
According to the government’s briefing, improved enforcement measures have generated an additional Rs1.3 trillion in tax revenue over the past three years, representing a reported 40% increase.
The prime minister appreciated the FBR Transformation Team for identifying revenue gaps and developing strategies to improve tax compliance.
He also praised officials involved in preparing the assessment and presented recognition shields to members of the team.
Prime Minister Orders Independent Audits of Monitoring Systems
Shehbaz Sharif welcomed an audit report examining the production monitoring system in the cement industry.
He directed the Ministry of Information Technology to conduct similar audits in other sectors to evaluate whether the digital systems are working effectively.
The audits are intended to assess the accuracy, reliability and performance of monitoring equipment.
The prime minister also instructed officials to address technical and administrative challenges that could delay implementation.
Textile Companies Cooperate With FBR Reforms
The meeting was informed that some textile manufacturers had resisted installing digital production monitoring equipment.
However, several major companies have voluntarily implemented the systems, including Nishat Mills, Alkaram Textile, Interloop Limited, Sapphire Textiles Limited and Nishat Chunian.
The prime minister appreciated businesses cooperating with the reforms and encouraged other manufacturers to adopt the monitoring arrangements.
Digital Tax Monitoring Aims to Reduce Revenue Losses
The government’s initiative is designed to improve transparency in industrial production and strengthen sales tax enforcement.
By collecting production information directly from factories, the FBR aims to reduce its dependence on figures submitted by manufacturers and identify discrepancies that may indicate underreporting.
The system could also help tax authorities identify revenue gaps and improve oversight of manufacturing activities.
However, its effectiveness will depend on accurate monitoring, reliable equipment, appropriate data protection and consistent enforcement.
FBR Faces December 31 Deadline
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The government has set December 31, 2026, as the deadline for completing the planned expansion of digital production monitoring.
The prime minister has instructed relevant departments to coordinate closely and ensure that implementation remains on schedule.
The initiative forms part of Pakistan’s broader tax administration reforms aimed at increasing revenue collection, improving compliance and strengthening the documentation of economic activity.
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