Home »Stocks and Bonds » Pakistan » Mobile phone top-ups: Cellular operators withdraw 10 percent service charges
Cellular operators have withdrawn 10 percent administrative/operational and service charges on card loads and balance transfers, following the directives of the apex court in this regard. When contacted, a senior official of the Federal Board of Revenue (FBR) told Business Recorder that the withdrawal of administrative/operational and service charges on card loads would not affect revenue collection of the FBR.

The mobile phone users will now get around Rs 88.9 after loading an Rs 100 card compared to Rs 76.9. This has been confirmed by senior officials at the Pakistan Telecommunication Authority (PTA) and mobile phone companies. The former chief justice had ordered to remove all kinds of taxes and service charges on mobile card loads; however, the decision was reversed recently and taxes on telecom services were restored. However, the telecom companies have been asked to not charge any service or operational fee for card loads.

According to the sources, 12.5 percent withholding tax and 19.5 percent federal excise duty (FED) are still applicable as before and will be deducted from mobile card recharge.

The FBR has estimated to collect Rs 70 to Rs 80 billion from withholding tax being collected from mobile phone companies in 2019-20. The FBR has already been collecting withholding tax on mobile phone top-ups. After getting written orders from the Supreme Court of Pakistan, the FBR had issued instructions to the mobile operators to start deducting the advance withholding tax from subscribers. The effective date of the implementation of the Supreme Court order was April 25, 2019 for restoration of all the taxes charged by cellular service providers on mobile phone top-ups. On April 25, the Supreme Court announced restoration of all the taxes charged by the cellular service providers on the mobile phone top-ups.

Copyright Business Recorder, 2019


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