FBR is studying video analytics as an alternative to Track & Trace. Here’s what each system does, key differences, and what manufacturers should do now.
What the Current Track & Trace System Does
Track and Trace (TTS) involves adding secure and machine-readable tax stamps on the products at the production stage. Such stamps consist of cryptographic qualities that can be scanned at any stage between the factory and the retail. Stated simply: each pack or unit has a unique ID which demonstrates that it has already had tax paid and can also make the FBR know where the product is within the supply chain. This prevents such pitfalls as under reporting, counterfeit goods, and undocumented goods transfers. Industries that utilize TTS have demonstrated an improved level of tax compliance and reporting.
How Video Analytics Would Work Inside Factories
Video analytics involves cameras and AI to send units through the production line and count them. It is able to display run-rate, downtime and output per shift. This assists factories to keep track of efficiency, and identify bottlenecks. The counting is however done within the plant. The camera system fails to monitor actions of goods once they have passed the gate to the transport, in warehouses or at retail.
TTS vs Video Analytics: Key Differences for Compliance
TTS offers end to end visibility since each product has a verifiable mark. Video analytics provide the number of productions, but not the product. That means:
- TTS has the ability to check the status of payment of taxes at any point; video analytics do not.
- TTS can be used to identify counterfeit or smuggled products; the video analytics are not able to confirm the authenticity.
- TTS enables field officer and even retailers to scan codes; video analytics can only be used in factory floors.
- TTS creates consumer trust as it displays a visible stamp; there is nothing displayed on the pack with cameras.
Why This Choice Matters for Revenue and Fair Competition
In the case of the FBR, the primary objective is proper collection of tax and reduced leakages. TTS helps with that objective, generating a digital tracking of every item until it gets to the shop. Video analytics may be helpful, but primarily on the internal factory control. There is no physical evidence on the item, hence the authorities, as well as buyers, can hardly distinguish between a compliant and non-compliant item. This constrains the enforcement and the message to the market that taxes were paid. There is a chance to have a hybrid model: preserve TTS as a legal evidence and apply video analytics to enhance the efficiency of a factory.
What Manufacturers Should Do Right Now
- Remain in compliance with Track & Trace which is already reported to your sector. Ensure tax stamps are put in in the right place and can be scanned.
- Implement video analytics within the plant and enhance planning, minimize waste, and early identify downtimes. This will be able to reduce expenses despite TTS being the formal compliance tool.
- Educate the train personnel about scanning, reconciliation, and reporting. Retain audit records to enable any discrepancies between production, dispatch and sales to be justified.
- Interact with FBR and industry organizations. Give realistic feedback on device placement, internet availability and support requirements to allow policy decisions to be adjusted to actual factory conditions.
