TRC body suggests electronic monitoring of tobacco industry

SOHAIL SARFRAZ

ISLAMABAD: The high-powered implementation committee of Tax Reforms Commission (TRC) has recommended electronic monitoring of tobacco industry on all supply lines of cigarette manufacturing companies through track and trace system to be implemented by any reputable company to be selected through open bidding.

Sources told Business Recorder that the meeting of the tax reforms implementation committee (TRIC) was held at the FBR House with Special Assistant to Prime Minister on Revenue Senator Haroon Akhtar Khan in the chair.

According to sources, the sub-committee discussed pros and cons of systems relating to electronic monitoring of production and supply of tobacco products. It was recommended that electronic monitoring would be done through implementation of a full-fledged track and trace system at tobacco companies. The supply lines of the tobacco companies would be monitored through track and trace system electronically to be installed by any of the reputable companies selected through open tenders by end-March 2017. Any company/firm can compete in the international open tender on merit. The transparency and merit would be ensured in selection of the firm for awarding the tender.

The committee deliberated at large the pros and cons of the tax stamping system. In this regard, it has been recommended that the full electronic monitoring would be done through the said tracking system and codified tax stamping.

The committee discarded simple tax stamping on tobacco products and recommended a composite solution based on latest technology of track and trace system. It also decided to go for the latest technology as discussed above. The on-site monitoring of the tobacco companies would be ensured through the state-of-the-art system of electronic monitoring, sources said.

It has also been decided that the taxpayer forensic audit of different sectors would be done through RFP/tender/advertisement for selection of the expert firm etc. It is expected that the tenders may be floated in this regard by the end of March 2017. At the first stage, the forensic audit of sectors like telecom and banking would be carried out after selection of firm/company.

The high-powered implementation committee of TRC also took decisions for strengthening of Tax Audit Function. A sub-committee was constituted, tasked with identifying two sectors /cases for purposes of forensic audit and determining the requirements in this respect. The proposal made by the member (TPA) relating to transparency in audit selection would be taken up for consideration during the budget exercise.

The high-powered implementation committee of TRC also decided to notify the Alternate Dispute Resolution panels within 15 days time period. It would ensure revival of the ADRC system to resolve disputes between the taxpayers and the tax department.

Meanwhile, Chairman FBR Dr Muhammad Irshad and Member Tax Reform Implementation Committee Syed Masoud Ali Naqvi as well as other members of TRC and FBR Board also attended the meeting. Various proposals firmed up by TRC for enhancing the tax revenue and broadeningthe tax base were discussed. Later, Chairman FBR Dr Muhammad Irshad presented sets of freshly updated and published books/booklets of various tax laws to members of Tax Reforms Commission. The tax books/booklets have been updated and published by Facilitation and Taxpayer Education (FATE) wing of FBR and will be sent to office-bearers and members of tax bars, trade bodies and business organisations for facilitation and reference in tax matters concerning the taxpayers.