A computer-vision pilot first trialled in cement around three years ago now underpins monitoring across a widening list of industries. Leather, paper and paperboard, packaged tea, household electronics, and edible oil and ghee are the latest additions.
ISLAMABAD, October 12, 2026: The Federal Board of Revenue has authorised ISSM Labelling Solutions, part of the wAI Industries group, to install, operate and maintain electronic production monitoring systems in five more manufacturing sectors, extending a framework that began roughly three years ago as a computer-vision pilot in the cement industry. Obsidian Technologies has been authorised across the same sectors, while Tollink Pakistan and Authentik have been cleared for the beverages sector.
The authorisation, issued under Chapter XIV-BA of the Sales Tax Rules, 2006, covers leather, paper and paperboard, packaged tea, household electronics, and edible oil and ghee.
What the authorisation requires
Authorised vendors will deploy Internet Protocol (IP) cameras and Network Video Recorders (NVRs) at designated production lines. Cameras must capture production continuously in real time, and NVRs must retain footage for at least two months. Equipment is to be tested at each site against FBR-approved specifications, with the Board given access to live feeds and stored recordings.
The data will allow tax authorities to set observed production against the figures manufacturers declare in their sales tax returns. Discrepancies may lead to verification, audit or enforcement action, subject to the applicable rules and the records and explanations businesses provide.
All footage remains the FBR’s property. It is to be treated as confidential and may be disclosed only as the Board directs.
Sector orders set the clock
Installation in each sector begins only once the FBR issues the relevant Sales Tax General Order. Earlier phases followed the same sequence: STGO 08/2025 brought textile spinning under monitoring, STGO 04/2026 covered packaged juices, and STGO 07/2026 extended the regime to aerated waters and beverages, including toll manufacturers, with installation deadlines set within weeks of issuance.
For paper and paperboard, the FBR’s Stage-I technical evaluation under Bid Reference 7(1)/IR/TDU/2026 sets a phased timetable: 20 percent of production lines covered by 15 November 2026, 50 percent by 15 December and full coverage by 31 December.
Sales Tax General Orders for the iron and steel sector and poultry hatcheries are expected in the coming week, which would open installation in both segments.
From stamps to computer vision
The framework traces back to a pilot developed by wAI Industries, ISSM’s parent group, with support from the UK government’s REMIT programme, which funded a customised solution to a public-sector tax-administration problem.
The pilot was a response to the limits of conventional stamping and marking. Physical marks are difficult to apply consistently in harsh production environments; a system designed for one industry rarely transfers cleanly to another; and fixed hardware tends to be costly, hard to customise and ill-suited to the varied layouts of modern production lines.
The pilot took a different route, using computer vision to observe and count output on the line rather than relying on a physical mark or a rigid hardware configuration. Branded Digital Eye, it was presented by its developers as among the earliest instances of a tax authority applying computer vision to monitor industrial production at scale.
After a year-long pilot and deployment in cement, the approach drew wider government attention. In this year’s budget speech, the Finance Minister said improved monitoring had saved the exchequer approximately Rs60 billion in the cement and sugar sectors.
An expanding footprint
Reported results in cement and sugar, together with the system’s relatively low cost and adaptability, built the case for broader adoption. ISSM has since operated as an FBR-authorised vendor in cement, sugar, tiles, textiles and beverages. The company says its visual analytics platform is installed in more than 300 manufacturing plants, with work under way in steel and iron, edible oil and ghee, leather, packaged tea, tyres and hatcheries.
Proponents argue that computer vision adapts more readily than fixed hardware to differing production environments, and is better placed to flag unusual activity or attempts to tamper with monitoring equipment.
A wider field of providers
The panel is now divided by sector. ISSM and Obsidian are authorised across the newly notified industries, while Tollink Pakistan and Authentik, which come largely from digital labelling and track-and-trace backgrounds, are authorised for beverages. Entry follows proof-of-concept evaluations conducted by the Board, and manufacturers in notified sectors must procure equipment from an approved vendor. A sector-by-sector approach also leaves room for specialised solutions in industries whose machinery, processes and compliance risks differ markedly from one another.
Policy context
Production monitoring is distinct from the FBR’s Track and Trace System. Cameras record manufacturing activity at the line; Track and Trace relies on tax stamps and identifying marks to establish the authenticity and movement of finished goods.
The expansion forms part of wider tax-administration reforms tied to Pakistan’s programme with the International Monetary Fund, whose April 2026 country report identified production monitoring, digital invoicing and stronger taxpayer audits as measures to improve the accuracy of sales tax declarations. It also shows how public-sector technology programmes and international partnerships can seed domestic capability in artificial intelligence, computer vision and industrial monitoring.
The test ahead
Industry bodies have questioned in earlier phases whether the regime is applied evenly. Formal-sector beverage manufacturers asked in August whether monitoring would reach small, toll and unregistered units or fall mainly on documented producers, a concern likely to resurface in leather and paper, where unregistered capacity is substantial.
The long-term impact in the newly notified sectors has yet to be demonstrated. Results will depend on consistent enforcement across registered and unregistered units, accurate identification of genuine compliance gaps, fair consideration of business records and explanations, and robust protection of the commercial information held in recorded footage.
If those conditions hold, a single-industry pilot will have become a national compliance architecture, linking domestic AI capability to a more data-driven model of tax administration.
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