ISLAMABAD: The Pakistan Telecommunication Authority (PTA) has rejected the Federal Board of Revenue’s demand to block SIM [Subscriber Identity Module] cards of over 0.5 million non-filers, arguing that such an order would not have legal bindings, and it would be contrary to the country’s legal framework.
The rejection of demand might trigger another controversy between the FBR and PTA, as both sides are citing different provisions of the law and legal framework. The FBR might consider the option of prosecuting those who would prefer to breach their provision of Income Tax General Order (ITGO) under Section 114B.
On the other hand, the PTA has sent out an official communication to the FBR, stating the enforcement of Section 114-B of the Income Tax Ordinance, 2001 and the order issued vide No.C.No.6(30)S(CIR-Operation)/2024 dated 29th April, 2024, as per applicable legal regulatory regime, the execution of Income Tax General Order, issued under Section 114-B of Income Tax Ordinance 2001, does not fall within the jurisdiction of Pakistan Telecommunication Authority. Accordingly, the ITGO dated 29th April 2024, referred to the Authority for compliance/ execution would have no legal binding effect, being inconsistent with the applicable legal framework.
In addition, it has also been observed that before execution of the ITGO order, factual issues with regard to usage of SIMs against CNICs (Computerised National Identity Cards) also need to be verified on the premise that any person may obtain eight SIMs (3 Data and 5 Voice); therefore, before issuing/implementing the ITGO, procedural steps with regard to notices would require to be issued by the FBR, as provided in Section 1I4-B of the Income Tax Ordinance, 2001. Nevertheless, the impact of execution of ITGO would also have an adverse impact on prevailing social norms, inter-alia, on the following: In Pakistan, male members of society prefer to register SIMs against their CNIC/ names instead of female(s) and juvenile members of family. Currently, as per available information, only 27pc SIMs have been registered against the CNIC of females.
Potential subscribers i.e., children/ female members of family using SIMs may be deprived of communication with specific reference to their educational activities.
It may also have an adverse impact on the confidence of foreign investment in the telecom sector, including objectivity of digital transformation. As a result of blocking of SIMs, multiple issues with regard to banking transactions, e-commerce/ online business activities, remittance directly into the mobile money accounts and financial support to family members as well as e-health activities, carried out through mobile connectivity, will also emerge Keeping in view the above facts and to avoid any litigious implication, it is suggested that instead of invoking the penal action in terms of blocking of SIMs at the first instance, other alternative modes for ensuring better compliance for filing of income tax returns may be sorted out by carrying out awareness campaign, sending SMS, etc.
Accordingly, the instant matter needs to be reviewed in a holistic manner after consultation with the relevant stakeholders, including the Ministry of Information Technology & Telecom. It was also stated that the official letter was issued with the approval of competent authority, the PTA letter concluded.