Telecom Operators Push for 5G Reforms to Accelerate Digital Growth

ISLAMABAD: The Telecom Operators Association (TOA) has urged the government to implement key fiscal and regulatory reforms to accelerate the 5G rollout in Pakistan and drive digital growth. In a detailed budget proposal submitted to senior officials, including the Federal Ministers for Finance, Commerce, and IT, as well as the heads of the Federal Board of Revenue (FBR) and the Pakistan Telecommunication Authority (PTA), the TOA outlined crucial measures to address industry challenges.

One of the primary recommendations is revoking the FBR Commissioner’s authority to reject advance tax estimates. This step is expected to minimize financial uncertainty and reduce litigation, creating a more predictable tax environment. The TOA also called for restoring flexibility in the Alternate Dispute Resolution Committee (ADRC) process, as recent amendments have made its decisions binding, removing the right to appeal. The association advocates for a return to the previous non-binding framework to boost taxpayer confidence.

To ease administrative burdens, the TOA proposed an exemption from withholding tax provisions, replacing them with a quarterly advance tax payment system similar to those in the banking and oil sectors. The proposal also emphasized the need for tax relief for telecom employees, citing rising inflation and high-income tax burdens as challenges in retaining skilled professionals vital for digital expansion.

In preparation for an extensive 5G rollout in Pakistan, the TOA seeks reductions in import duties and regulatory charges on essential telecom equipment. The proposal includes removing the 5% regulatory duty on telecom power equipment such as lithium-ion batteries, eliminating additional sales tax and regulatory duty on SIM card imports, and cutting the 9% regulatory duty on critical telecom infrastructure components to zero. These measures aim to lower operational costs, enhance broadband services, and attract investment into the sector.

By addressing these structural issues, the Telecom Operators Association aims to create a more business-friendly environment that fosters industry expansion and contributes to economic growth. The proposed telecom sector reforms are designed to streamline operations, reduce compliance costs, and support Pakistan’s transition toward a stronger digital economy. The government’s response to these recommendations is highly anticipated, with industry experts closely monitoring whether these changes will mark a transformative shift for Pakistan’s telecom landscape.