ISLAMABAD: The telecom operators on Friday warned the Senate Standing Committee on Finance that there might be connectivity load-shedding hitting the country next fiscal year by shutting down mobile phones for hours if the Custom Duty on Fiber Optical Cable and other taxes were not slashed drastically.
“We want to share the doomsday scenario with you as there will be connectivity load shedding hitting the country in 2023 if the duty and taxes on Fiber Optical Cable and other taxes on telecom sector were not reduced substantially. There will be shutting down of mobile phone for hours and ATMs services will be disrupted because there will be no connectivity ensured without fiber optical cables,” the representatives of three major telecom operators including Jazz, Telenor and Ufone briefed the Senate Standing Committee on Finance here on Friday afternoon.
They said the Custom Duty on Fibre Optical increased from 10 to 20 percent. There is Additional Customs Duty of 6 percent and Regulatory Duty of 10 percent. They demanded to reverse it to 10 percent. The Minister of State for Finance Aisha Ghaus Pasha and the Chairman FBR Asim Ahmad told the committee that the National Tariff Commission (NTC) increased duty on import of fibre optical to promote local industry. The industry representatives also asked the government to reduce advance tax on prepaid card from 15 to 10 percent.
The FBR high-ups informed the Senate panel that a new section has been added in the Income Tax Ordinance to provide data sharing mechanism with NADRA to expand the tax net. Irregularities in the procedure for issuance of audit report by the Commissioner have also been rectified.
The penalty for non-submission of income statement within the due date has been made more comprehensive. The process of linking all major retailers with FBR's POS system has been started. Penalties for sales tax evasion by not using the POS system and shutting down the system have also been imposed.
The Chairman FBR said that at present the number of first tier retailers in the country is around 30,000. We strive to integrate them all into the FBR's POS system as soon as possible. The Committee members opposed the imposition of withholding tax on overseas payments by credit / debit or prepaid cards and recommended amendments to the relevant section.
The Secretary Railways, appearing before the Committee, recommended that the Railways be included in Schedule 5 for the import of locomotives, passenger cabins and spare parts on the analogy of Aviation department. The committee members unanimously directed the officials of the ministry to sit down with the railways and resolve the issue.
The representatives of the Pharmaceutical Association apprised the committee of the difficulties faced by the sector. They said that a tax has been imposed on the import of raw materials used in medicines which will lead to the decline of the industry. Minister of State for Finance Dr. Ayesha Ghous Pasha assured the officials of the association that their problems would be considered and resolved as soon as possible.
The representatives of beverage industry argued that there should be no discriminatory taxation on any sector and stated that there were many items where more sugar was mixed to make their products.
