FBR production monitoring must cover 17 industries by December. Steel, poultry and tyres are next.

The tax authority’s cameras are coming to many more factories. Prime Minister Shehbaz Sharif has directed the Federal Board of Revenue to complete FBR production monitoring across major manufacturing sectors by 31 December, Dawn reported late on Monday. The system lets the tax authority see how much a factory actually produces, so it can compare that with the sales tax it declares. For manufacturers in steel, poultry, tyres, edible oil and several other sectors, the deadline is weeks away.

The short version

• The system is already fully installed in sugar, cement, tobacco, tiles and fertilisers.
• Textiles, packaged water, juice and milk have bought equipment and are installing it.
• Steel, poultry and tyre makers must buy equipment by 15 October; tea, household electronics, leather, paper and board, and oil and ghee by 30 October.
• The target is full operation in all of them, 17 industries in total (Knock-On count), by 31 December.

What happened

At a meeting in Islamabad on Monday to review FBR reforms, the prime minister directed officials to remove “all hurdles in the installation of automated production monitoring systems”, according to Dawn. He said businesses that collect tax from consumers but do not deposit it are not entitled to any concessions, and called collecting tax at the country’s full potential a “true service to the public”. He also asked the IT ministry to audit other sectors to assess how well the system works.

The FBR uses cameras under what it calls a “faceless system” to monitor output. Officials told the meeting that government measures over the past three years had brought in an additional Rs1.3 trillion in tax, a 40% increase in collection, which they attributed to enforcement.

Why it matters

Production monitoring closes a familiar gap: goods that leave the factory without being recorded, and the sales tax and excise that go with them. Where it works, documented firms stop competing against rivals who under-declare output. It also fits the FBR’s wider push to widen the net, from the retailers’ fixed tax scheme to taxing social media creators.

Not every industry has been keen. Dawn reported that some resisted installation, and named ten textile companies that installed the system voluntarily, including Nishat Mills, Interloop and Sapphire Textiles, whose cooperation the prime minister praised. The timing is sensitive for textiles, where exporters are warning of a steep fall in orders.

The knock-on effects

First order: compliance costs for manufacturers

Firms in the newly covered sectors must buy and install equipment within weeks and adjust their reporting. Larger companies can absorb this; small steel re-rollers, poultry processors and ghee units may find it harder.

Second order: prices and competition

If under-declared output comes onto the books, firms that were avoiding tax lose a cost advantage. Some may raise prices to cover the extra tax, especially in steel, edible oil and poultry, which feed into construction and food costs.

Third order: revenue and the IMF programme

Higher sales tax collection from manufacturing would help the government meet revenue targets without new tax rates. Dawn’s report gave no estimate of the revenue the new sectors could bring.

Who could benefit

• Fully documented manufacturers, which face fairer competition.
• Monitoring equipment and system suppliers, with several sectors buying kit this month.
• The FBR, if the system narrows the gap between actual and potential tax collection.

Who may face pressure

• Small and informal producers in steel, poultry, tyres, leather and ghee.
• Consumers, if extra tax costs are passed on in staple goods.
• Firms that resisted installation, now facing a direct instruction from the prime minister.

What to watch

• 15 October: equipment purchase deadline for steel, poultry and tyres.
• 30 October: deadline for tea, household electronics, leather, paper and board, and oil and ghee.
• 31 December: target for full operation in all sectors.
• The IT ministry’s audit of how well the system works.

Sources

• Dawn, PM Shehbaz directs FBR to complete digital production monitoring system across major industries by year end, 12 October 2026

This is analysis, not investment advice. Figures are as of 12 October 2026.