Highly-taxed Telecom sector contributed Rs.744 Billion in taxes

During the last five years alone, the Pakistani Telecom sector has contributed a sum of Rs. 744 billion in terms of regulatory duties and taxes.

The Telecom industry in Pakistan is booming currently, thanks to an influx of smartphones in the country. Being a highly taxed industry, this has also resulted in the government getting a huge share of the revenue through taxes and regulatory duties.

In the first three fiscal quarters of this year, a total of Rs. 105.9 billion was contributed to the government by the telecom sector.

The amount is inclusive of initial and annual license fees, initial and annual spectrum fees, Universal Service Fund (USF) and Research and Development (R&D) Fund contributions, Access Promotion Contribution (APC) for USF, Numbering Charges, license applications including General Sales Tax (GST)/Federal Excise Duty (FED), SIM Activation Tax, Advance/Withholding Tax (WHT), sales tax on mobile handsets, custom duties and other taxes.

The licensing of 4G and 3G technologies to telecoms has also made up a huge part of these taxes. Another telecom operator, Telenor, recently joined the list of 4G providers in Pakistan by winning the 850 MHz spectrum auction in Pakistan.

Pakistani citizens are already paying some of the highest taxes around the globe for using telecom services. The amount of taxes and duties paid by Pakistan telecoms reflects that.