Reports are that the Postpay users won’t have to pay their government-induced taxes from now on.
The Supreme Court of Pakistan had earlier taken notice of the exuberant mobile taxes being charged to the consumers on card reloads. The Pakistani users were paying as much as 42% in taxes and on a card reload of PKR 100, they were receiving a credit of just PKR 61.93. The taxes included 17.5-18.5% of General Sales Tax and 12.5% of Withholding Tax. A 10% of service charges were also being charged by the company operator itself.
After the notice was taken, taxes were removed with immediate effect and the mobile users started receiving full prepaid card loads. The facility, however, didn’t come for the Postpay users and they continued to pay taxes on the billed amount. Now, the Postpay users on Ufone have started receiving a text message stating that all of the taxes for the Postpay customers have also been declared void since October 16th. All the other mobile operators are also soon expected to follow the suit.
Due to the cancellation of taxes, the Federal Government is losing around Rs. 120 million of revenue every day. That’s not it, the provincial governments were also losing around Rs. 160 million per day due to the suspension of the General Sales Taxes. We will have to wait as the authorities find a more viable solution to tax the telecom segment.