The government has assured the International Monetary Fund that expanded production monitoring in the textile and other industrial sectors is expected to generate an additional Rs. 48 billion in revenue during FY2026-27 as Pakistan pushes ahead with tax enforcement reforms under the IMF program.
The commitment was disclosed in the IMF’s third review report under the Extended Fund Facility and second review under the Resilience and Sustainability Facility.
According to the report, the Federal Board of Revenue is deploying production monitoring systems in sectors identified as having the largest tax gaps, particularly the textile industry. Authorities have already completed full deployment of monitoring systems in the sugar, cement, tobacco, and fertilizer sectors, where the estimated tax gap stands at around Rs. 160 billion.
The textile and beverage sectors are currently in the pilot phase and are expected to become fully monitored by the end of October 2026.
The IMF report stated that the FBR has assigned 200 personnel to help operate the production monitoring systems. The initiative is aimed at improving the reporting of sales tax revenues by tracking production quantities more accurately across monitored industries.
According to the Fund, the intervention is expected to increase reported revenues in sales tax returns and generate an estimated Rs. 48 billion in additional tax revenue during FY2027.
The IMF said the effectiveness of the monitoring system will be evaluated through key performance indicators, including growth in sales tax revenues from monitored locations compared with the previous year after adjusting for nominal GDP growth, as well as the volume of goods identified through monitored production sites.
