Rs 100bn proposed taxes on mobile, internet withdrawn

After pressure from certain quarters, Federal Minister, Shaukat Tareen, has announced the withdrawal of Rs 100 billion tax measures from the consumers of phones and the internet.

The Federal Minister announced this withdrawal on the telecom sector during a post-budget conference at P block. 

Soon after the release of Finance Bill 2021-22, Electronic and Social media took the news and criticizing the PTI government for this anti-public decision and campaigned to undo the decision.

Under the Finance Bill 2021-22, the PTI government has levied Federal Excise Duty (FED) on phone calls exceeding three minutes at the rate of Re 1, whereas ten paisa per SMS and similarly Rs 5 per GB internet data.

The proposed taxes would have helped the Federal Board of Revenue (FBR) to collect Rs 100 billion from mobile and internet consumers. 

Federal Minister for Finance and Revenue Shaukat Tareen further claimed that the federal cabinet, on another day while approving the national budget, rejected this specific measure of FBR for taxing mobile and internet consumers. 

Earlier, the government had introduced taxes worth Rs 100 billion on mobile and internet users in finance bill 2021-22-.

The finance ministry in the budget document proposes to impose an additional tax burden of Rs 100 billion on mobile and internet users.

The Finance Bill 2021-22 proposes to impose an additional burden of Rs 70 billion on federal excise duty on mobile users and Rs 30 billion on internet users.

The Finance Ministry had proposed to impose other taxes on account of the federal excise duty of Rs 1 on every mobile phone call for more than a minute and a national excise duty of 10 paise on every SMS.

The proposals include a federal excise duty of Rs 5 per GB of internet data. It had also proposed Excise duty. The budget document proposes to reduce the holding tax on mobile phone services from 12.5 percent to 10 percent.