Federal Board of Revenue (FBR) has directed all cigarette manufacturers to implement fully automated 'Track and Trace' system on tobacco products in six months period or non-compliant factories would be sealed.

It is learnt that the directions have been issued by Project Director 'Track and Trace' system to the cigarette manufacturers during the last meeting of the stakeholders recently held at the FBR House. The FBR had also invited the licensee to attend the meeting. Out of 11 cigarette manufacturers, the meeting was attended by two major companies and three local manufacturers.

The authorities of Azad Kashmir assured the FBR that the AJK tax department would implement the said project for units operating within the jurisdiction of the AJK.

The project director warned that the factories of those cigarette manufacturers would be sealed which would not implement 'Track and Trace' system as per given timelines i.e. end April 2019 and grace period of three months.

According to a recent tweet of Shabbar Zaidi, "FBR will be instituting within this financial year, fully automated 'Track and Trace' system for at least four major sectors of industry, in addition to tobacco, which is already in process. The industries under consideration are aerated beverages, sugar, cement and fertilizer."

Under FBR SRO 250(I)/2019, the licensee shall be responsible to operationalize the system within six months of issuance of license. The licensee shall run and manage the system under proper warrantee and shall ensure maintenance during the period of license. The licensee shall charge fee for tax stamps from the manufacturer or importer, FBR said.

The stakeholders including licensee informed the FBR that at least six months would be required to import the required machinery for the project. The FBR responded that the project can be implemented in six months and another three months grace period, sources added.

Under the law, the manufacturer or importer of specified goods shall make all production facilities available for installation of the system and allow access to the licensee for routine operations, inspection and maintenance.