Telecom player demands WHT abolition

Foresees significant growth in mobile data consumption in next 5 years


Zafar Bhutta May 27, 2023
PHOTO: FILE

ISLAMABAD:

A major mobile services industry player has urged the government to consider abolishing the withholding tax (WHT) on telecom sector in the upcoming budget for fiscal year 2023-24.

Highlighting the exorbitant taxes of 34.5% on telecom users, Jazz CEO Aamir Ibrahim emphasised that the withdrawal of WHT would promote the affordability of mobile broadband for the low-income segments of society. He foresaw average mobile data consumption reaching 12 GBs by 2028 and called for framing enabling policies in order to continue meeting Pakistan's growing data demand.

The cellular subscriber in Pakistan now uses an average of 7.5 GBs of mobile data per month (as of January 2023), a significant increase from just 2 GBs in 2018.

If this trend continues, the cellular subscriber could be using up ton GBs per month in the next five years. These insights were shared by the Jazz CEO while talking to The Express Tribune. He called telecom and internet crucial utilities for productivity, much like electricity for the third industrial revolution.

"Our industries, such as software development, IT-enabled services, and our marketplaces no longer rely on physical locations but instead operate on smart phones and require a reliable internet connection," he pointed out.

The growth in data demand has been supported by an investment of $4 billion by the cellular operators in Pakistan. While stressing that increased data growth delivers enormous socioeconomic dividends, Aamir cautioned that the telecom industry's dollarised cost structure had caused the average revenue per user (ARPU) to dip to $0.75 - the lowest globally.

"An ARPU below $1.5 is not sustainable for the industry to operate."

COMMENTS (1)

Adil Gilani | 1 year ago | Reply I have been in telecoms my entire career. Telco s are just making excuses. Instead of focusing on plugging the gaps in their cost structure they want a free hand out. Diesel theft at towers over manning of towers by 100 percent micro solar and wind ins to power towers tower consolidation etc are all cost cutting measures that they refuse to implement. Instead of value add services addition ir efficiency gains the attitude is please give us a tax cut.
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