The federal government has ordered an independent three-year audit of customs bonded warehouses nationwide amid mounting concerns over rule violations and tax evasion, while Prime Minister Shehbaz Sharif has set October 1 as the launch date for the first phase of the FBR’s long-awaited faceless tax system.
The twin directives came during a high-level review meeting where the prime minister also ordered nationwide physical stock verification of bonded warehouses — privately operated facilities where imported goods are stored after customs clearance — and called for tighter controls on licensing, security, valuation checks, and IT systems.
The audit was triggered after a private company was allegedly found manipulating in-bond and out-bond rules for temporary gains, a matter the Prime Minister’s Secretariat said has since been investigated and resolved. But the prime minister made clear there would be no leniency going forward, warning that officials caught in illegal activity would face strict action under the law and directing the FBR to post officers of “good reputation and integrity” to sensitive positions.
Bonded trade accounts for 16.5 percent of Pakistan’s total imports, underscoring the scale of the revenue at stake. The meeting also reviewed the monitoring of petroleum cargo through the WeBOC customs system and discussed measures to crack down on smuggling, tax evasion, and illegal businesses.
In a separate push to modernise tax administration, the prime minister directed the FBR to accelerate its reform programme and ordered its chairman and senior officials to spend two days each month in Karachi and Lahore — the country’s commercial nerve centres — to strengthen enforcement and help meet revenue targets.
The centrepiece of that reform effort, the faceless Inland Revenue system, is now on a hard deadline. The first phase is to go live by October 1, with full implementation targeted by 2027. The technology-driven platform will use artificial intelligence and digital tools for tax audits and assessments, randomly allocating cases irrespective of geographical jurisdiction — a move designed to curb discretion and corruption. It will feature a National Faceless Audit Wing for tax audits and a Faceless Assessment Unit for adjudication.
The meeting was also briefed on recent enforcement actions against illegal cigarette manufacturing, with authorities shutting down factories in Chakwal and Swabi and seizing illicit stock and machinery.
