The telecom sector has been contributing over Rs100 billion annually to the national exchequer in the form of taxes during the last few years, according to official data.
The total contribution was over Rs109 billion in fiscal 2010 of which almost half came from General Sales Tax (GST) while the rest from duties, regulatory charges and other taxes. Contribution rose 15% to Rs56.3 billion in the first half of fiscal 2011 against Rs49 billion in the same period last year.
Telecom sector, the highest taxed industry, contributes more than 90% share in total taxes by the services sector to the federal divisible pool which is being diverted to provinces under 18th Amendment, according to an estimate.
The GST collection in telecom services mainly comes from the mobile sector and its share in total GST collection is 86% followed by basic services as 11%.
The activation tax contribution to the national exchequer fell to Rs3 billion in the first half of fiscal 2011 from the preceding year’s Rs4 billion. The core reason for the drop in the activation tax is market maturity.
Published in The Express Tribune, July 9th, 2011.
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ