No tax on internet and SMS, proposed duty reduced on phone calls: Tarin

Federal Finance Minister Shaukat Tarin clarified on Friday that there would be no tax; on internet usage and SMS, while 75 paisa would be collected in tax; for every mobile phone call exceeding the duration of five minutes.

He adds that visually-impair mobile phone users would be exempt from taxes on handsets.

Tarin announced these changes to proposals in the Finance Bill 2021-22 during a National Assembly (NA) session.

Initially, the finance bill had proposed tax of Re1 per call if the duration exceeds three minutes, Rs5 per GB for internet usage and 10 paisa on each SMS.

However, in a post-budget press conference, Tarin clarifies: “We are not doing it at this time.” He says the proposals had been opposed by the prime minister and the federal cabinet so it was “off the table”.

The proposals drew the public’s ire, with users storming social media with criticism of the government. Many had even tag the prime minister; in their tweets saying that the “budget killed digital Pakistan initiative of the PM.”

This widespread criticism had also led to Energy Minister Hammad Azhar denying that additional duties had been imposed on telecom and data usage.

“The PM and Cabinet did not approve the FED levy on internet data usage. It will not include in the final draft of the Finance Bill (budget); that is place before parliament for approval,” he had said in a tweet.

Taxes Reduced

During his address in the NA, Tarin also announced the reduction and withdrawal of other taxes.

He says the tax on milk had been removed and 17 per cent tax on gold and silver was being reduce to one per cent and three per cent; respectively. However, he added that the 17 per cent tax would remain in place for the value addition of the metals.

Ruby Naeem