Govt unveils plans to cut taxes on telecom sector

12 Mar 2021

Pakistan’s government has announced plans to grant the telecommunications sector industry status, with reduced taxes and duties as part of the upcoming budget, with a view to boosting the sector and helping improve connectivity, Dawn reports. According to the local daily, the sector will be given industry status from the 2021/22 fiscal year (starting 1 July 2021), when several other cost reducing measures will also be introduced. These include cutting the advance income tax on mobile phone users from 12.5% to 10.0% (with a further decrease to 8.0% to follow in 2022/23), the tax on telecommunications services from 8.0% to 3.0% and the federal excise duty on telecommunications services from 17% to 16%. The government’s reforms also feature the elimination of the PKR250 fee for the issuance of new SIMs, and reductions in fees associated with the import of telecommunications equipment and raw materials related to manufacturing. Federal Minister for IT and Telecommunication Syed Aminul Haq was quoted as saying of the plans at a press conference: ‘This is a major achievement which will directly benefit not only mobile phone users but will also help spread the goal of “Digital Pakistan” to remote areas.’

Pakistan, Ministry of IT & Telecommunication (MoITT), Pakistan Telecommunication Authority (PTA)