A Leading Telecom Operator Starts Blocking Non-Filer SIMs After FBR’s Threat

Pakistan’s tax authority, the Federal Board of Revenue (FBR), is locked in a battle with telecom companies over blocking SIM cards of non-tax filers. This move aims to encourage tax compliance but has sparked concerns from both sides. A leading telecom company has conveyed to the Federal Board of Revenue (FBR) that the telecom operator has started blocking 3,064 non-filer SIMs under protest with apprehension of lawsuit with the tax department.

According to the communication of the operator to the FBR, “since FBR is enforcing the implementation of income tax general order (ITGO) prior to the defined statutory timelines of May 15, 2024, considering the inherent limitations of our systems and its automation costs, potential litigation that may and without be faced by telcos and the burden of undue cost, it is hereby submitted that compliance to ITGO is being made under protest and after intimating these limitations to FBR”, telecom operator added.

A Leading Telecom Operator Starts Blocking Non-Filer SIMs After FBR’s Threat

Last month, the FBR issued an Income Tax General Order (ITGO) targeting over 500,000 individuals who haven’t filed tax returns despite meeting the criteria. The FBR’s strategy involves blocking the mobile phone SIM cards of these non-filers, aiming to nudge them towards fulfilling their tax obligations.

A leading telecom company, in a communication to the FBR, expressed reservations about the implementation timeline. The FBR’s deadline of May 15th, 2024, clashed with the telecom operator’s concerns regarding system limitations and automation costs. The company argued that meeting the deadline might lead to technical glitches and potential legal disputes with affected customers. Additionally, the manual blocking process, agreed upon on May 10th, raises concerns about the financial burden placed on telecom companies.

FBR also formed a Joint Working Group (JWG) comprising tax officials and telecom representatives

This collaborative effort aims to streamline the SIM card blocking process, addressing the concerns raised by the telecom industry. Finding common ground will be crucial in ensuring a smooth implementation of the FBR’s initiative. It will minimize disruption for both non-filers and telecom companies.

The FBR’s strategy holds the potential to boost tax collection by pressuring non-filers to comply. However, concerns remain regarding the effectiveness of this approach. Blocking SIM cards could disrupt essential communication services for individuals, potentially leading to frustration and resistance. Additionally, the impact on those who might be unaware of their tax filing obligations needs to be considered.

The coming days will be crucial in observing how the FBR and telecom companies navigate this situation. A collaborative approach through the JWG can potentially lead to a solution that balances the FBR’s need for increased tax revenue with the concerns of the telecom industry and its customers. Open communication and a focus on efficient implementation will be key in determining the success of this initiative.

See Also: Non-Filers To Pay More Taxes On Mobile Recharge & Bundles

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Onsa Mustafa

Onsa is a Software Engineer and a tech blogger who focuses on providing the latest information regarding the innovations happening in the IT world. She likes reading, photography, travelling and exploring nature.

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