Supreme Court Cancelled Tax Collection On Mobile Cards
Supreme Court Cancelled Tax Collection On Mobile Cards: The Supreme Court of Pakistan has suspended tax collection on mobile cards here on Monday.
Last month, Chief justice of Pakistan (CJP) Mian Saqib Nisar had taken notice of the high levy charged on mobile phone cards in the country as he asked under which law Rs.40 were being deducted from Rs.100 mobile cards.
A three-member bench of the SC heard the suo motu case at the Lahore Registry. The CJ observed that there should be a difference between those who pay their taxes and the evaders.
Justice Ijaz Ul Ahsan questioned Chairman Federal Board of Revenue, whether a person who does not fall under the tax net can be charged?
On this, the FBR chief explained that collection of service charges from mobile phone users is the policy of telecom companies.
At present, as per some reports, on the charge of a Rs.100 pre-paid mobile card, a 19.5 percent Federal Excise Duty (FED) is charged along with 12.5 percent withholding tax and 10 percent service/maintenance charge.
During the hearing, Justice Ijazul Ahsan remarked how the tax can be collected from a vendor who does not come under the tax net.
Replying to a question, the counsel for companies said that tax was deducted when the user subscribes a package. To which, Justice Ahsan observed that Rs.68 added to the user’s account when a Rs.100 mobile phone card it topped up.
CJP Nisar remarked, “Mobile packages have tarnished our culture”.
The CJP took the notice on May 3 and had issued notices to the federal government and cellular companies, asking “under which head an amount of Rs.40 is being charged on every Rs100 recharge.”
Earlier, Senator Muhammad Ateeq Shiekh during the meeting said, consumers, have to pay Rs.28 on Rs.100 card which is unfair. The government should remove advance and withholding tax being charged on Rs100 mobile card, he demanded.
According to statistics revealed by the Pakistan Telecommunication Authority in January this year, the number of mobile phone users stands at 144 million as compared to 142.5 million in October 2017.
The court also ordered to form a comprehensive plan for deducting taxes on mobile cards, adding that the taxes – withholding tax, federal excise duty and others – will not be deducted until the final verdict in the case is announced.
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