The Pakistani government is taking a stricter approach towards non-filers, those who haven’t filed their income tax returns. This includes imposing non-filers pay tax on mobile phone top-ups and bundles.
Starting May 15th (subject to implementation), non-filers will face a non-filers tax on mobile charges in the form of a 2.5% additional tax and withholding tax. This move aims to incentivize tax filing and increase government revenue.
The Federal Board of Revenue (FBR) is also considering levy potentially taxing every mobile and data recharge. The data of non-filers has already been shared with the Pakistan Telecommunication Authority (PTA) to facilitate enforcement.
However, implementing this strategy has hit a roadblock. The PTA, responsible for regulating telecoms, has refused to block SIM cards of non-filers, citing concerns about its technical feasibility.
The PTA highlighted potential negative impacts, including:
- Disproportionate impact on women who often use SIM cards registered under men’s names.
- Difficulty in restoring service for non-filers who eventually do file their taxes.
- Potential harm to digitalization and the overall telecom economy.
Undeterred, the FBR is reportedly considering legal action against the PTA and cellular companies by filing a petition with the Islamabad High Court (IHC). This ongoing saga highlights the government’s efforts to increase tax compliance while the PTA emphasizes potential drawbacks associated with blocking SIM cards.
The ultimate outcome and impact on non-filers pay tax on mobile recharge remain to be seen. It’s a developing situation with both sides presenting valid arguments.
