Pakistan’s Telecom Operators Association has voiced concerns about the substantial taxes introduced in the 2024 budget. In a communication to Salim Mandviwala, Chairman of the Standing Committee on Finance, the association detailed its apprehensions.
The operators warned that unresolved tax issues could deter foreign investments and potentially drive them out of Pakistan. The letter highlighted that two major players in the market are considering exiting the Pakistani market due to these fiscal challenges.
The sector, which generated PKR 340 billion in tax revenue last year and has seen USD 15 billion in direct investments, fears the new budget measures could undermine the vision of a Digital Pakistan. It emphasized that collecting a 75% advance tax from non-filer telecom users is not feasible.
The proposed budget measures could lead to significant revenue losses for the telecom sector and the government. The operators also raised concerns about the Income Tax General Order and the penalties for blocking non-filers SIM cards, stating that the telecom sector should not be penalized for non-filers tax issues.
Additionally, the increase in the sales tax rate on mobile phones priced up to USD 500 could adversely affect the inclusion of the low-income group. The telecom operators have requested a meeting with Committee Chairman Saleem Mandviwalla to discuss these critical issues.
