Business Desk 
Oct 31, 2025
The federal government has started an investigation into a large-scale sales tax fraud, where billions of rupees were allegedly siphoned off through fake invoicing and manipulated tax data.
The Prime Minister Shehbaz Sharif on Thursday ordered an international forensic audit of the Pakistan Revenue Automation Limited (PRAL) system after a massive sales tax fraud scandal came to light.
The decision was taken during a meeting on Federal Board of Revenue (FBR) reforms, when the prime minister was informed how PRAL’s outdated technology and ineffective monitoring system had allowed the fraud to continue for years.
The highlighted scams involved fraudulent invoicing, inflated returns, and false manipulation of digital records, none of which was picked up by the system since there was no real-time tracking of records, and no data protection mechanism.
After calling the incident “unacceptable,” the PM called on the authorities to determine all individuals associated with the companies and institutions in which fraud occurred and directed the authorities to roll out an investigation within three weeks, along with a follow-up by the relevant department of law enforcement.
Officials advised the premier that look-ups PRAL’s outdated digital solution had long been a major weak point in Pakistan’s tax administration, and the fraud is thought to have affected major sectors of the economy, including textiles, construction, and the import-export businesses.
In response to this, the government began implementing broad reforms. New upgrades to PRAL now include an audit vault, a database protection wall, and a security operations centre to strengthen Pakistan’s tax infrastructure. The revamped system also records user IP addresses whenever data is altered, making future manipulation more difficult.
