Govt Slashes 5G Revenue Hopes, Turns to Mobile Phone Taxes in Budget 2025–26
In the federal budget for 2025–26, the government has sharply reduced its expected revenue from 4G/5G license fees, shifting focus instead to increasing collections from mobile phone-related charges. According to official budget documents, Rs22.612 billion has been budgeted under non-tax revenue from 4G/5G license fees for the upcoming fiscal year. This is significantly lower than the Rs32.612 billion initially estimated for 2024–25, which was later revised down to Rs27 billion.
The cut in expected spectrum revenue suggests either a delay in the 5G rollout or weaker-than-anticipated interest from telecom operators. While the Ministry of IT and PTA had indicated that Pakistan is gearing up for 5G trials, the lower revenue target indicates limited progress in the auction process.
At the same time, the government has raised its estimate for income from mobile handset levies, budgeting Rs12 billion for 2025–26. This marks an increase from Rs 10 billion allocated for the current fiscal year. The adjustment reflects a shift towards relying on consumer-level charges amid slower telecom sector expansion.
Another major source of non-tax revenue is the Pakistan Telecommunication Authority (PTA) surplus, recorded under income from property and enterprise. For the next fiscal year, the government expects Rs1.1 trillion from this head, lower than the Rs1.2 trillion budgeted for 2024–25 and significantly less than the revised Rs1.431 trillion actually collected.
Meanwhile, revenue projections from regulatory authorities’ surpluses and penalties also show a downward trend. The government has allocated Rs 6.239 billion under this head for 2025–26, compared to the originally expected Rs 10.036 billion for this year. That amount was later revised dramatically downward to just Rs654.7 million.
The changing composition of expected revenues indicates the government’s reliance on existing telecom infrastructure and consumer-level taxation, rather than growth from new technologies like 5G. It also highlights the continued importance of mobile handset imports and regulatory collections to federal income.
With delays in 5G rollout and shrinking room for windfall spectrum earnings, consumers may continue to bear the brunt of telecom-related taxes.
Also read:
Negative Impact of PTA Taxes on Pakistani Mobile Phone Market Dynamics
