ISLAMABAD, Feb 20: The finance ministry has asked the Central Board of Revenue (CBR) to depute sales tax officials at around 79 sugar mills across the country to monitor procurement of sugarcane, and production and clearance of the commodity from these mills.

Informed sources told Dawn on Monday that the decision was taken following the analytical report compiled by the CBR, which indicated that about 18 per cent reduction was noted in the clearance of sugar from the mills under investigation during the current season. This showed that these mills have enough stocks in their godowns, which have not been released.

The CBR had already deputed, in the first phase, sales tax officials in 34 sugar mills across the country to monitor their cane procurement process for ascertaining their actual sugar production capacity during the current season.

According to the report, a copy of which was made available to Dawn showed that the sugar stocks with these mills stood at 300,903 tons on Jan 31, 2006 which increased to 487,853 tons on Feb 16, 2006.

The report further revealed that the procurement of sugarcane registered a growth of 40 per cent this year since the cane-crushing started in December last. Moreover, the sugar production also registered over 23 per cent increase in case of 34 sugar mills under review during the current season.

The average price of sugar in most of the sugar mills was reported at Rs26 per kg excluding the sales tax on Feb 6, 2006. However, around eight mills under investigation have projected the average price at Rs30-28 per kg with the exemption of two which declared their price at Rs31 per kg.

With 15 per cent GST on sugar mean that the average price should be in the range of Rs30 per kg. But was sold out at Rs40 to 42 per kg in the market.