FBR radar detects eight tax-evading sugar mills

ISLAMABAD: Eight sugar mills — many of them belonging to political elites — have been found involved in tax-evasion of billions of rupees.

The FBR’s tax revenue appreciated to billions of rupees in the outgoing fiscal year after the tax machinery tightened the screw on the sugar sector.

During the proceedings of the National Assembly’s Standing Committee on Finance here on Wednesday, Opposition Leader Omar Ayub Khan sought the details of those sugar mills which were found involved in tax-evasion and preferred to remain non-compliant.

The meeting was also attended by Minister for Finance and Revenue Muhammad Aurangzeb and State Minister for Finance Bilal Azhar Kiyani.

This whole episode triggered when FBR Chairman Rashid Mehmood Langrial informed the committee that tax collection from sugar mills had increased after the FBR took action.

Langrial said he could produce the video showing how these sugar mills did not comply. However, Omar Ayub Khan reminded during the committee proceedings that the list of sugar mills evading taxes was yet to be shared.

On Langrial’s instruction, the FBR staff furnished the list of sugar mills after two hours when Omar again sought the list. The FBR chairman shared a closed envelope with the committee chairman Naveed Qamar who then handed it over to the opposition leader.

At the end of the committee proceedings, when Langrial was asked about the imposed penalty on the non-compliant sugar mills, he responded that he did not know the exact amount.

However, the question arises why criminal proceedings were not initiated against the sugar mills evading taxes.

Israr Khan reports: One of the sugar mills had installed a concealed chute designed to divert sugar production and evade official monitoring. The FBR sealed the chute and seized 1,200 metric tons of sugar from the premises.

Similarly, another mill disconnected its production lines from the FBR’s digital monitoring system – a move interpreted as a deliberate attempt to conceal output. As a result, 150 metric tons of untaxed sugar and five vehicles used in transport were seized.

One mill was completely sealed after it failed to hand over the custody of Network Video Recorder (NVR) system to the FBR officials, violating compliance protocols.

One of the non-compliant mills was caught dispatching sugar bags without the mandatory Track-and-Trace System (TTS) stamps – a key tool for ensuring tax compliance.

The FBR sealed the mill’s godowns and conducting a comprehensive stocktaking exercise.

Another mill was found with incomplete CCTV camera installations – a violation of surveillance requirements. The weighbridge at the site was sealed by the FBR. Additionally, the same mill faced another action for frequent malfunctions and errors in its shooters —automatic bagging machines — leading the FBR to seal the defective shooter.

Similarly, one mill was found diverting sugar supplies to an area that lacked TTS monitoring, bypassing official oversight. The FBR sealed the entire bagging area in response.

One of mills also came under scrutiny after officials detected errors in its shooter systems and a mismatch in sugar bag counting. The shooters were sealed to prevent further unregulated production.

Langrial assured the committee that the FBR teams would continue monitoring sugar mills using technology and on-ground inspections to ensure full compliance with tax laws and regulatory mechanisms.