Federal Board of Revenue (FBR) Chairman Rashid Mahmood Langrial has rejected claims that the faceless customs clearance system in Karachi caused a loss of Rs100 billion to the national treasury.

He said the internal audit findings were misleading and part of a conspiracy by certain stakeholders and officers to undermine the system aimed at curbing corruption.

FBR chairman defends faceless customs system

Chairman Langrial clarified that the Customs Department’s internal audit report was based on incorrect figures and leaked before reaching the FBR. He described the report as part of a deliberate negative campaign against reforms, allegedly orchestrated by individuals unhappy with the new system.

“It is wrong to say that the faceless system caused a loss of Rs100 billion,” Langrial stressed, adding that action would be taken against those responsible for providing false information.

Conspiracy to undermine reforms

The Pakistan Customs audit report identified serious shortcomings in the December-March revenue. However, The FRB chairman claimed a conspiracy involving certain officers and stakeholders had been exposed. He admitted that differences existed between officers of different cadres but reiterated that the faceless system will not be rolled back.

He emphasized that the project was launched to prevent corruption, bribery, and misdeclarations that were common in the manual system.

“Forty-five officers sitting in one hall cannot commit fraud under this system,” Langrial remarked, while acknowledging that although bribery and groupism have not been eliminated entirely, opportunities for malpractice have significantly reduced.

Audit Report Leak Sparks Inquiry

Pakistan Customs confirmed that the audit report was prepared in July to identify shortcomings but was leaked before being shared with the FBR. Member Customs Syed Shakeel Shah said this was a serious breach, and an inquiry has been initiated.

FBR officials said the officers behind the report were disgruntled over not receiving promotions and deliberately included incorrect figures. A committee has been formed to hold them accountable.

Clarification on Revenue and Vehicle Clearance

Rejecting claims of revenue loss, officials stated that revenue collections have actually increased since the introduction of faceless assessment.

They confirmed that no vehicle was cleared without paying duty, citing the example of a Land Cruiser on which Rs47.2 million in taxes were collected. They added that action had been taken against officers involved in illegal clearance of vehicles.

Reforms and improvements underway

Langrial reiterated that the faceless customs system is a good project that will be further improved with technical upgrades to prevent hacking. He added that under the old system, people used to mis-declare information with the help of the staff.

He noted that:

The system was designed to facilitate u, not just increase revenue.
Demurrage costs have reduced, while revenue is expected to grow.
A new cadre for assessments will be introduced.
Reforms are ongoing, and while mistakes may occur, the system will continue to be strengthened.

Ending the culture of recommendations

The FBR chairman emphasized his commitment to meritocracy. “In the past year, not a single officer has been appointed on the recommendation of any minister,” Langrial said, adding that the culture of recommendations has been eliminated from the FBR in the last one year.

Customs System Reforms to Continue

FBR officials confirmed that the World Bank has recommended further improvements to the faceless system, which will remain in place.

They underlined that the old manual clearance system will not return, and corrective measures will ensure the system remains transparent and resistant to manipulation.