Telecom sector granted Industry status

The incumbent government has announced to grant the status of industry to Telecom sector. This was announced by Federal Minister for Information Technology and Telecommunication Syed Amin-ul-Haque during a press conference.

In addition to Industry status the telecom sector has also been granted various tax reliefs which will be applicable from the next fiscal year starting from July 2021.

The Tax relief includes cut in advance income tax on mobile phone users from 12.5 percent to 10 percent, which will be further reduced to 8 percent in 2022-23, federal excise duty will be brought down from 17 percent to 16 percent. Furthermore the charges of Rs250 on SIM card have been abolished and services tax on telecommunication companies reduced has been reduced from from 8 percent to 3 percent. “Today we have 176 million mobile and smart phones connections with more than 83 percent teledensity,” he said

The need for high proliferation of mobile broadband services in the country and its impact on overall GDP and productivity was highlighted during the current COVID-19 pandemic.

The cabinet has also approved the reduction of 4 percent customs duty and 9 percent regulatory duty on import of telecommunication equipment. The minister further said that the cabinet has also approved reduction of tax on telecommunication services from 8pc to 3pc for all telecom companies with PTA licence.

To promote the digital environment in Pakistan the government is setting up digital technology parks all across the country. Up till now, 40 software technology parks have been set up in under developed areas such as Swat, Bannu, Quetta, Faisalabad, Karachi and Sukkur under the public private partnership.