Telecom Companies Dismiss Levy on Calls Exceeding 5 minutes

PTCL along with all other mobile phone companies have warned the government of Pakistan that the newly proposed Rs0.75 federal excise tax on phone calls after 5 minutes time period is tough to implement and may negatively affect the service model of the entire telecom sector.

In a letter to Finance Minister Shaukat Tarin and IT Minister Syed Aminul Haq, all of the telecom companies including PTCL, Jazz, Telenor, Ufone, and Zong4G have shown resentment over the new proposal in the Finance Bill 2021 to levy FED at the rate of Rs0.75 after 5-minutes call.

Telecom Companies Dismiss Levy on Calls Exceeding 5 minutes

Furthermore, the telecom companies said that this new development would shake the confidence of the investor community in the telecom industry of Pakistan that had remained the biggest recipients of foreign direct investment (FDI).

According to the letter,

If forced upon the industry, [levy] shall cause major disruption and damage to the service model structure of the telecom sector. This levy would be unimplementable and would result in withdrawal of free minutes and bundles which are used by the majority of our customers.

Moreover, the letter said that more than 90 percent of voice minutes were used via packages, and if this service was abolished and normal rates were charged to customers, then their call rates would ramp up multiple times.

In addition to that, the clarification presented by the finance minister regarding his own budget speech that no new taxes would be levied on the telecom sector was mentioned in the letter. Apart from this, the general public has also shown resentment over these new taxes.

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