Rs730bn tax exemption troubles

November 11, 2026

The scale of the gap emerged during a meeting of the Senate Standing Committee on Interior and Narcotics Control’s subcommittee on November 10, chaired by Senator Saifullah Abro.

The Federal Board of Revenue (FBR) told the committee that imports worth Rs1,120.662 billion had been recorded between 2018 and June 2026. However, consumption certificates covered only Rs389.865 billion, leaving more than Rs730 billion unexplained.

The sector-wise figures point to significant discrepancies across several industries. Steel accounted for Rs148.248 billion, textiles and fabric Rs146.955 billion, food Rs100.884 billion, and ghee and oil Rs76.487 billion.

The investigation has also exposed difficulties in obtaining records from companies benefiting from the scheme. The Federal Investigation Agency (FIA) said it had issued 512 notices, but only 19 companies appeared and submitted partial records. More than 100 notices were returned or remained undelivered.

The FIA said investigations were under way and the matter was before the competent court. Possible diversion of goods, corruption, abuse of authority and wrongful release of financial securities are among the issues being examined. No final determination of guilt has been made.

Senator Abro questioned the issuance of 20 consumption certificates involving approximately Rs64 billion and demanded supporting documents and explanations. He also asked the FBR to examine whether payments had been released without proper verification and whether the 2021 Statement of Requirements had been followed.

The committee’s concerns extended beyond missing financial records. Members questioned the lack of coordination between the FBR and FIA, particularly after learning that the two departments had different accounts of their awareness of the court proceedings. They also challenged the FBR’s reluctance to share information with Parliament.

The possible movement of tobacco-related goods outside the tax-exempt areas was another concern. The committee directed the FBR, FIA and Customs authorities to trace imports, consignments, routes and destinations to establish whether businesses elsewhere had improperly benefited from the scheme.