Telecom Sector Demands Cut in Advance Income Tax
Pakistan is among the highest-taxed telecom markets in the world. The overall 34.5pc tax on telecom users including 15pc advance income tax and 19.5pc GST makes the country second-highest in telecom taxation in South Asia. In FY 2021, the advance income tax was reduced from 12.5pc to 10pc for FY 2021 with a commitment to 8pc onwards vide Finance Act 2021. However, the move was taken back six months later, without due consideration to its long-term ramifications. Through Finance (supplementary) Act, 2022, the AIT rate has been increased from 10pc to 15pc taking the overall tax on over 193 million telecom users to almost 35pc. The industry also urged the State Bank of Pakistan to remove the 100 per cent cash margin restriction on the import of telecom equipment. The industry also asked for the harmonisation of federal and provincial Sales Tax Laws. See Also: Jazz, Telenor and Ufone Demand Reversal of 100pc Cash Margin Requirement for Imports
