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ECC Agrees to Cut Telecom Sector Taxes

Telecom Sector Taxes

On Wednesday, The Economic Coordination Committee (ECC) of the Cabinet decided to reduce taxes on the telecom sector and asked for negotiations with port terminal operators to reduce charges on Afghan cargo containers.

The decision to reduce taxes on the telecommunication sector was taken in the meeting of ECC supervised by Adviser to PM on Finance Dr. Abdul Hafeez Shaikh.

Read more: Pakistan to auction extra telecom spectrum for $1 billion

According to Dr. Shaikh, the government aims to facilitate the people and businesses to help them stay connected and operate businesses without physical movement as much as possible due to the fact that coronavirus is still surfacing and people are reliant on broadband and other telecom services.

The ECC constituted a sub-committee about two months ago advocated, on the demand of the telecom companies in order to eliminate taxes which were adjustable as they created cash flow problems.

Now, 19.5 percent of sales tax is applicable to telecom services besides advance income tax at 12.5 percent on most of the telecom services including voice, SMS, and MMS services.

The ECC approved in principle a request for waiver and reduction in rates of certain taxes so that the telecom sector may be facilitated.

The meeting also decided to allocate 38 million cubic feet per day from three new wells Rehman 6, 7, and 8 in Sindh to the Sui Southern Gas Company Ltd, subject to regulatory approvals. The gas will be provided as per availability in the winter months. The renewal of the contract with TAVANIR Iran for the purchase of electricity of 104MW till 31st December was also approved.

The ECC meeting was attended by only four members including just one minister, Shaikh Rasheed Ahmed, out of about a dozen. Advisers to the prime minister on commerce and institutional reforms & austerity, special assistants to PM on petroleum and revenue also attended the meeting.

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