Govt crackdown on sugar mills boosts tax revenue by 54 per cent

ISLAMABAD: Finance Minister Muhammad Aurangzeb revealed on Tuesday that the government’s intensified scrutiny of sugar mills this season has led to a remarkable boost in sales tax revenue.

Speaking during a televised briefing alongside Federal Minister for Information Attaullah Tarar, Aurangzeb noted that tax collection from the sugar sector reached Rs24 billion in the first two months of 2025, compared to Rs15 billion during the same period in 2024 – a significant rise of 54 per cent.

Addressing concerns about the smuggling of sugar to Afghanistan, the finance minister assured that Pakistan’s sugar reserves are more than sufficient for local demand.

He emphasised that enhanced border controls have curbed illegal sugar smuggling, resulting in legitimate exports of the commodity to Afghanistan instead.

“This is the first time that sugar has been exported rather than smuggled, a crucial step for our economy as we need ‘every single dollar’ to stabilise the current account,” Aurangzeb stated.

As part of the government’s ongoing reforms, Aurangzeb highlighted the Federal Board of Revenue’s (FBR) introduction of an advanced monitoring system for sugar mills and the movement of sugar.

This system includes five key components: a track-and-trace mechanism, automated control hoppers, video surveillance, and digital oversight. As a result of this initiative, six sugar mills have already been sealed for violations, and sugar is now reaching legitimate distributors, preventing stockpiling by hoarders.

To ensure compliance, Aurangzeb explained that FBR officials are now stationed at sugar mills nationwide, working alongside personnel from the Federal Investigation Agency (FIA) and the Intelligence Bureau. These steps have bolstered enforcement and accountability within the industry.

Since the introduction of this monitoring framework, 10 shot hoppers and six sugar mills have been sealed, and penalties totalling Rs125 million have been imposed.

Aurangzeb stressed that these measures are crucial for maintaining transparency in the sector and ensuring that revenues are maximised for the benefit of the country.

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