The International Monetary Fund (IMF) has expressed deep concern over the widespread smuggling of 120,000 tons of petroleum products per month in Pakistan and has demanded an explanation, well-informed sources told ProPakistani.
The situation has prompted the IMF to demand a comprehensive report from the Ministry of Finance and the Federal Board of Revenue (FBR), according to sources within the tax regulator.
The primary focus of this report is to evaluate the measures taken thus far to curb the illicit smuggling of petroleum products. The IMF is pushing for a significant expansion in both the number and capacity of customs and law enforcement personnel at the border areas.
These steps are seen as crucial in addressing a staggering loss of more than Rs. 10 billion in customs duties and levies directly attributed to the smuggling of petroleum products.
The IMF has warned that failure to stop the smuggling will result in a significant revenue shortfall, sources added. Sources further said that direct instructions to both the FBR and the Finance Ministry have been issued by the IMF to take immediate and robust steps to enhance revenue collection and curb smuggling as a top priority.
Iranian Petroleum products are heavily subsidised by the Iranian government. Smuggling is an extremely lucrative proposition. There is plenty of profit to make sure that smuggling continues.
The previous government encouraged this practice as it benefitted their syncopats.