ISLAMABAD: Phone call charges for Pakistanis abroad will become cheaper as the government gets a go-ahead to implement its decision to remove taxes on the incoming international calls.

“Two days ago, the Supreme Court upheld the directive of the government to abolish the controversial international clearing house (ICH), which was challenged by the long distance and international call operators last years,” said State Minister for Information Technology Anusha Rehman at a joint press briefing with Chairman Pakistan Telecommunication Authority (PTA) Dr Ismail Shah.

According to the minister, the reduction in the rates for the incoming international calls would also reduce grey traffic in the country.

Stay orders against govt decision to remove tax on international calls vacated by SC

Grey traffic is the use of illegal exchanges for making international calls, bypassing the legal routes and exchanges in which the government lost revenues.

Last year, all 14 long distance and international operators challenged the government’s decision to withdraw the ICH tax in the Sindh High Court.

“When the government got the stay vacated, they obtained another stay from the Lahore High Court. We then took the issue to the Supreme Court which declared the stay orders infructuous,” said Ms Rehman.

According to the minister, the ICH tax had caused ‘dangerous’ problems after it was introduced in August 2012.

“It pushed the telecom sector into a monopolistic environment where LDIs formed a cartel. Call charges on incoming international calls shot up. Telephony declined as subscribers switched to free alternative solutions like Skype and Viber through internet. Grey traffic got a boost and incoming minutes dropped from roughly two billion to 400 million minutes,” said the minister, explaining how grey traffic cost the government over $1 billion a year.

In June 2014, the Ministry of Information Technology abolished the international clearing house tax mechanism, keeping in view the LDI operators, including mobile telecom companies, would earn higher profits.

“Now the market forces will determine the rates for incoming international calls in a similar way as cellular mobile companies compete to offer best rates to their subscribers,” said Ms Rehman.

SIMs blocked

Chairman PTA Dr Ismail Shah said over 10.4 million unverified cellular connections had been blocked since January 12.

Following the school massacre in Peshawar on December 16, 2014, the Ministry of Interior gave the PTA 91 days to block all the unverified SIMs. The drive to block the unverified connections began on January 12 and will end on April 13.

The PTA has introduced the biometric SIM verification system that requires a thumb impression of the owner of the SIM to authenticate the connection.

More than 70,000 machines have been introduced by the cellular operators and installed in shops, malls and mobile vans to re-verify the subscribers.

Dr Shah said over 62.74 million SIMs had been verified against 47.8 million plus computerised national identity cards (CNIC).

He said connections for overseas Pakistanis would also be blocked.

However, such subscribers have a year to re-verify their connections before their SIMs are recycled and available for sale in the market again.

Published in Dawn, February 28th, 2015

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