RTO Peshawar Using Track and Trace System Data to Increase Tax Collection

Regional Tax Office (RTO) Peshawar is utilizing the production and clearance data of the track and trace system of the Federal Board of Revenue (FBR) for increasing taxes from five major sectors including tobacco.

This system has been successfully implemented in various tobacco units of Khyber Pakhtunkhwa, aiding RTO Peshawar in seizing illegal shipments of tobacco and related products. In this regard, the FBR has received a report on the performance of the RTO Peshawar.

The report revealed that the RTO in Peshawar has tightened the noose against tax evaders under the leadership of Chief Commissioner RTO Peshawar Aqeel Ahmad Siddiqui. The RTO has established various checkpoints and mobile squads to keep an eye on goods being supplied from tax-exempt erstwhile tribal areas to taxable areas under section 40D of the Sales Tax Act, 1990.

The law strictly prohibits business entities of non-tariff areas from selling items to taxable areas without charging the required Sales Tax and FED under the garb of tax exemptions. RTO Peshawar has taken an active role by establishing various checkpoints and mobile squads to monitor goods supplied from tax-exempt areas to taxable areas under section 40D of the Sales Tax Act, 1990, the report said.

The vehicles were seized which were carrying different goods, including foam mattresses, paper and paperboard materials, plastic, steel, pipes, and cement. Out of the 82 vehicles, 69 were released after payment of the required sales tax, while 13 vehicles remain under seizure. The value of goods in these seized vehicles was worth millions of rupees, and consequently, sales tax recovered and deposited in the national treasury amounted to around Rs. 12 million, the report said.

This is not the first time RTO Peshawar has conducted such operations. RTO Peshawar is very active in stopping the smuggling and sales of non-duty paid/counterfeit cigarettes and tobacco.

In the last eight months, the RTO conducted 13 raids in which almost 23 million sticks of cigarettes, involving Federal Excise Duty of more than Rs. 47 million and sales tax of Rs. 13 million have been seized. Furthermore, large quantities of tobacco worth 1 million have also been seized involving Rs. 444 million in Federal Excise Duty (FED).

In a ceremony held at Kacha Garhi, Peshawar to counter the illicit trade of non-duty paid cigarettes almost 25 million sticks of non-duty paid/counterfeit cigarettes were set on fire, the value of which was around Rs. 90 million. The FED involved was Rs. 52 million and sales tax of Rs. 13 million.

The report highlighted that the RTO Peshawar has been making full use of the track and trace system, which is a flagship project of the FBR for stemming the flow of duties and taxes in the tobacco industry.

This system has been successfully implemented in various tobacco units of Khyber Pakhtunkhwa, aiding RTO Peshawar in seizing illegal shipments of tobacco and related products.

Presently, RTO Peshawar has deputed three mobile squads for surveillance and monitoring duties, with various check posts established at entry and exit points of FATA/PATA, mostly on the Motorway.

The crackdown on tax evaders is a positive step towards ensuring transparency in the tax system and promoting a culture of compliance. It is essential that all businesses and individuals contribute their fair share to the national exchequer, as this revenue is critical for the development and progress of the country, it added.