The Federal Board of Revenue has initiated enforcement of video analytics based electronic production monitoring across the tiles manufacturing sector, directing all registered units to install the required systems without further delay. The move has been carried out through Sales Tax General Order number 02/2026, IR Operations, issued under the Sales Tax Act, 1990, and forms part of the tax authority’s ongoing effort to bring greater transparency to production reporting in industries where underreporting has historically contributed to significant revenue losses.
Under the order, all tile manufacturing units were required to complete installation of the video analytics systems by April 30, 2026. The Federal Board of Revenue has stated that strict compliance with this timeline is mandatory, and the authority holds the power to stop the delivery and dispatch of goods produced at any facility that has not completed the required electronic monitoring installation. The Lahore High Court had previously granted a stay to the sector regarding the video monitoring requirement, but that stay has since been vacated, clearing the way for the Federal Board of Revenue to proceed with full enforcement across the industry. The tax authority has designated M/s ISSM Labelling Solutions Private Limited as the official vendor responsible for supplying, installing, and integrating the monitoring systems at manufacturing facilities across the country.
The monitoring framework relies on real time surveillance and automated production tracking, allowing the Federal Board of Revenue to verify actual manufacturing output against the volumes reported by individual units for tax purposes. This approach mirrors similar enforcement measures the tax authority has already rolled out in sectors such as sugar, cement, tobacco, and textile spinning, where video based monitoring has become a central tool in efforts to curb underreporting and close gaps in tax collection. Officials have indicated that tile manufacturing has faced longstanding concerns over understated production figures, prompting the extension of this monitoring approach to the sector following complaints from industry associations representing compliant manufacturers.
The Federal Board of Revenue has reiterated that non compliance will attract strict enforcement action, including the imposition of penalties and legal proceedings, the sealing of business premises, and any other measures prescribed under the Sales Tax Act, 1990, along with the rules made under it. The tax authority has framed the initiative as part of its continued push to use technology for improved tax compliance, curb underreporting, and create a more level playing field for manufacturers who already comply fully with existing tax obligations. All stakeholders in the sector have been advised to extend full cooperation to both the authorized vendor and Federal Board of Revenue teams to ensure the installation process proceeds smoothly and within the required timeframe.
The enforcement action against the tiles sector follows a broader pattern seen across Pakistan’s manufacturing industries this year, with the Federal Board of Revenue extending similar video based monitoring requirements to multiple production intensive sectors as part of its wider digital enforcement strategy. Manufacturers who continue to resist installation may face escalating consequences, including the suspension of their ability to dispatch goods, until the required systems are fully operational and integrated with the tax authority’s central monitoring infrastructure.
Follow the SPIN IDG WhatsApp Channel for updates across the Smart Pakistan Insights Network covering all of Pakistan’s technology ecosystem.
