According to the Fertiliser Manufacturers of Pakistan Advisory Council (FMPAC), no reliable evidence of global performance of the TTS has been found within the fertiliser industry.
The fertiliser industry was forced to make a huge investment in the installation of the TTS despite apprehensions expressed in various meetings. The performance of the system has been dismal in the open environment and the consortium that provided the equipment has been unable to attend to the issues.
Industry leaders demanded a replacement for the TTS or a refund for the amount it has invested. In a letter addressed to Finance Minister Ishaq Dar, FMPAC requested the government review the enforcement of the non-compatible TTS installed on fertiliser manufacturing facilities.
According to the letter, in compliance with SRO 250(I)/2019 dated February 26, 2019, and the Sales Tax General Order No 3 of 2021, dated March 11, 2021, issued by the Federal Board of Revenue (FBR), the TTS deployment project was initiated for the fertiliser industry in February 2022.
Tripartite agreements between the manufacturers, FBR and FBR licensee (M/s AJCL/MITAX/Authentix Consortium) were signed on April 14, 2022, and the TTS was made operational across the entire fertiliser industry from the given deadline of July 1, 2022.
However, the fertiliser industry has raised serious concerns about the suitability of the system for fertiliser production facilities after confronting multiple technical issues during and after implementation.
The letter states that the incompatibility of the TTS with the harsh and humid outdoor environment of the fertiliser industry renders it ineffective and unfit for continuous use. The stamp detection efficiency is far less (as low as 50%) than the guaranteed value of more than 99%. Stamps reconciliation also generates errors with actual production reporting. Despite the best efforts of the FBR licensee, FBR and other industry stakeholders, these technical issues remain unresolved.
Commenting on the matter, FMPAC Executive Director, Sher Shah Malik said, “The fertiliser industry is one of the most compliant sectors in Pakistan and has always supported the government’s efforts of documentation of the economy.”
He further stated, “The TTS is neither considered suitable for the fertiliser industry nor is it serving any of its stated objectives of enhancing tax revenues, reducing counterfeiting or preventing the smuggling of illicit goods.”
The fertiliser industry cautioned the government that the enforced obligation of the TTS, with its unreliable operational efficiency, can disrupt the fertiliser supply chain leading to serious consequences for the agriculture sector.