PM Shehbaz Sharif orders third-party audit for transparent tax reforms

A weekly meeting chaired by Prime Minister Shehbaz Sharif to review FBR reforms received a detailed briefing on the reforms under way in the organisation. These include the restructuring of PRAL, the digitalisation of the tax system and measures to curb smuggling.

The Prime Minister said tax reforms were being implemented to promote national development and strengthen the economy. He said digitalisation, production monitoring and automated systems were key pillars of the FBR reforms. He also directed that effective action against tax evasion, smuggling and illegal business be stepped up.

The meeting was told that work was continuing in phases on IRIS 3.0, a new tax operating model and a central data hub to make the tax system modern, integrated and data-driven. International consultants have been hired to design IRIS 3.0.

According to the briefing, new senior leadership has been appointed at PRAL in several areas, including technology, data security, operations and the tax domain. Under IRIS 3.0, work is also continuing rapidly to make the tax system more effective, to pilot the concept of auto-tax, and to use Artificial Intelligence and machine learning in future to improve tax collection.

On the positive results of faceless assessment in customs, the meeting was told that average revenue per goods declaration rose by 12 per cent between January and June 2026.

Faceless assessment has not only improved revenue but also made it easier to identify and monitor import irregularities. The meeting was told that the recruitment of 280 goods evaluators, to make the customs assessment system more integrated, was in its final stages.

Progress is also continuing on setting up a Central Assessment Unit in Islamabad. The target is to make it functional under an interim arrangement by 31 December 2026, and to make the fully integrated facility functional in a new complex by June 2027.

On digital invoicing, the meeting was told that transactions worth Rs236 billion were made through the system in July 2025. They rose to more than Rs2.5 trillion in July 2026. The target is transactions worth Rs4 trillion through digital invoicing by December 2026.

The briefing on anti-smuggling measures said several steps had been completed to stop the illegal movement of petroleum products. These include GIS tagging of legal petrol pumps, tracking of petroleum products by GPS, linking the ERP systems of oil marketing companies to the tracker, and a central tracking app for law enforcement agencies.

Through the Rahe Guzar app, 2,500 illegal petrol pumps have been shut down and legal action has also been taken against them.

Directing that the implementation of FBR reforms be speeded up, the Prime Minister said the aim of the reforms was to make the tax system modern and effective, increase revenue collection and end smuggling completely.

He welcomed the appointment of goods evaluators with a good reputation in the FBR and praised the efforts of the FBR chairman and his team.

Federal ministers Azam Nazeer Tarar, Dr Musadik Masood Malik, Ahad Khan Cheema, Muhammad Aurangzeb, Attaullah Tarar and Shaza Fatima Khawaja, Minister of State Bilal Azhar Kayani, Member of the National Assembly Usman Owaisi, State Bank Governor Jameel Ahmad, the FBR chairman and other senior officials attended the meeting.