PAKISTAN has one of the world’s lowest call rates, due to which mobile phone saturation is around 85 per cent. Mobile phone service charges are so low and mobile phone connections are so easy to maintain that most users have connections in all the five mobile telecommunications companies.

Therefore, this is the right time to introduce taxes in the form of GST on telecommunications cost of each individual. But I believe that the way the government is charging this tax is not right.

The current method deducts the GST at the time of loading credit to the telecommunications company. This kind of deduction creates a negative feeling towards the government among the users.

Since the tax is deducted by the telecommunications companies and then paid to the government, I think the proper way to deduct this tax would be in the call/sms charges of the individual telecommunications company. The tax should be incorporated into per-minute call charge or sms cost the telecommunications company charges the users.

All telecommunications companies should only be allowed to advertise rates in same units and should have taxes incorporated into their rates.

This way the users will be able to better compare the prices of the five telecommunications companies, and the user will not feel that the government is charging unfair tax on him/her.

The telecommunications companies will still collect the tax and pay it to the government. This will also bring the telecommunications charges up at par with the regional charges.

Since the Pakistan’s telecommunications sector is so saturated, such a tax would only lower the revenue of telecommunications companies for a few months only, which will again pick up once the telecommunications industry and the users come to terms with the new rates.

Since each mobile number is registered against a CNIC, the telecommunications companies should also file their taxes with the CNIC of the users. This data will help highlight high taxpayers (or users) to the FBR, which may have not registered for annual tax payment but are paying more than Rs10,000 a month for telecommunications charges, increasing the number of taxpayers in Pakistan.


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Comments (2) Closed

Jul 12, 2013 11:29pm

Are you for real or Ishaq Dar in disguise to encorage fleecing of the public ?

Jalaluddin S. Hussain
Jul 13, 2013 04:52am

As an overseas caller from Canada, I would request the Government of Pakistan to look into reducing applicable tariffs from Canada to Pakistan.