The Federal Board of Revenue has intensified its crackdown on tax evasion in the sugar sector by sealing two more sugar mills for violating digital monitoring rules. The action reflects the authority’s firm stance against non-compliance during the ongoing crushing season.
According to officials, two chutes at Chanar Sugar Mill in Samundri, Faisalabad, were sealed after inspectors found violations of the mandatory Track and Trace System. The system is designed to monitor sugar production in real time and prevent tax leakage across the supply chain.
In a separate enforcement move, Safina Sugar Mills in Lalian, Chiniot, was also sealed for failing to comply with electronic tracking requirements. Authorities confirmed that the mill did not fully integrate the monitoring system despite repeated instructions.
The tax authority stated that these actions form part of a zero-tolerance policy aimed at ensuring transparency in sugar production. Officials stressed that the Track and Trace System remains central to controlling undocumented output and curbing revenue losses.
Moreover, enforcement efforts have been stepped up as the crushing season progresses. Several sugar mills have already faced similar penalties in recent days, indicating a broader campaign rather than isolated action. Authorities believe strict oversight is necessary to discourage attempts to bypass digital controls.
FBR officials clarified that monitoring will not stop with the end of the crushing season. Instead, inspections and digital audits will continue to ensure long-term compliance and protect consumers from artificial shortages and price manipulation.
The tax authority also warned sugar mill owners against attempting to disable or bypass the tracking system. Any further violations, officials said, would trigger immediate sealing, fines, and possible legal proceedings.
Meanwhile, industry observers say the latest enforcement wave signals a shift toward stronger accountability in sectors traditionally accused of underreporting production. The sugar industry, in particular, has faced repeated allegations of tax evasion and regulatory loopholes.
FBR maintains that effective enforcement will help stabilise market supply while ensuring due taxes are collected. Officials reiterated that compliance, not confrontation, remains the preferred route for mills operating during the season.
As scrutiny intensifies, sugar mill operators are expected to strengthen internal controls and ensure full integration of monitoring systems. The coming weeks are likely to test the sector’s willingness to align with digital taxation reforms.
