Internet Taxes by Punjab can Cause National Economy Up to Rs. 200 Billion in Losses

It is widely accepted that broadband infrastructure and services contribute to economic growth and job creation. As a result many governments have made the development and use of broadband services a policy priority.

There are various researches available to prove that 10 percent increase in internet penetration can boost a country’s GDP from 0.1 to 1.5 percent, with high impacts found in developing market, such as Pakistan.

Broadband subscriptions in Pakistan were just 3.4 million in April 2014 before the auction of 3G/4G licenses, and now with-in one year of 3G/4G services we have 15 million 3G users. Which mean that a whooping 15 million increase in broadband subscription or 8.33% (of total 180 million population) increase in internet penetration in the country.

Consequently, it can be drived that Pakistan’s GDP grew around 1 to 1.4 percent during the last year only.

According to PLUM Research titled “Economic and Social Benefits of 3G in Pakistan”, Pakistan would be adding Rs. 40 billion to its economy due to this increase in internet penetration during first year of auction. Multiple effect could add another Rs. 1,000 billion to the economy in next five years.

This research can Googled by using keyword “Plum Economic and Social Benefits of 3G in Pakistan”. You can go ahead and study it to know more about how and in what manner broadband penetration can help Pakistani economy. 

Punjab will gain mere 2-3 billion through taxes against several hundred billions in potential losses due to slowness in 3G/4G uptake

However, with recently imposed taxes on internet, it is estimated that this uptake in broadband subscription will plunge by 20-25%. This slowness will be caused due to increased data rates plus sluggish network rollouts and future investment in technology up-gradation from cellular operators.

Which means, our national economy can potentially lose up to Rs. 200 billion (20 percent of Rs. 1,000 billion gain as proven above) due to these taxes.

Moreover, its just not the money, its the jobs — over 900,000 of them that Anusha promised at the time of auction while citing the same PLUM research — a lot of e-health, e-education, e-banking, e-farming and other development projects that we won’t be able to do just due to taxes.

Interestingly, if you are wondering, currently the data revenues of Pakistani cellular companies stand around or less than Rs. 26 billion per year. Since Punjab has 56% of cellular subscribers, total tax collection from data services (at 19.5%) isn’t going to cross Rs. 2.5 billion per year. Another billion or two from fixed segment and other forms of internet (WiMAX, EVDO, FTTH etc.)

This figure is going to go further low when we exclude those customers with less than Rs. 1,500 bills and less than 2Mbps speeds.

So the final equation is that Punjab will gain mere 2-3 billion against several hundred billions in losses in five years.

We are hoping that sanity will prevail, and soon too.

Tech reporter with over 10 years of experience, founder of ProPakistani.PK


  • Talha

    “It is estimated that this uptake in broadband subscription will plunge by 20-25%”
    Can you kindly share the source of this bold claim?

    • Ahmed Habib

      Well, he is blogger who like to join pti soon. So he making statements. Soon, you will see change in name propti. Shame that this site is named propakistani, I am feeling shame.

      • aamir7

        Sir facts pay baat karain, cheekhnay ka koi faida nahi.

        • Talha

          so you can kindly share the fact behind the 20-25% claim?

        • shahid ali

          aap kay khayal mei jo aap keh rahe hain wo facts hain ???

          • aamir7

            Prove them wrong. I am just referencing a research paper. Prove it wrong.

            • shahid ali

              Meray bhai research aap ne jo link karai hai us mei yeh kaha likha hai kay ye tax punjab ko nuksan dai ga, kya mei aur aap aik hi article or research dekh rahe hain. Dekhain us research mei yeh hai kay internet penetration mulk kay liye kitna faida mand ho sakta hai ye kahan hai kay punjab ka lagaya hua tax ab is ko barbad kar de ga ????

              • aamir7

                hazoor tax lagao gay tu uptake kam hogi k nahi? kiya internet penetration k growth rate wohi rahay ga? agar growth rate kam hogi, tu potential faida kam hoga ya nahi?

                Please aqal ko hath marain zara.

                • shahid ali

                  I am not discouraging you but please do not say it like this. It is not that simple. You need to understand economics. Her cheez mehngy hoty hai meray bhai . Aur ecnomics mei norml aqal chalty to phir hum aur aap ministers ko gailian nai day rahe hotay. This is called speculation if you want to speculate you must clearify this in you post that you fear that internet penetration can take a hit. But it is not necessary. Their are many more factors involved demand of something decreases not just simple increase in price due to tax. And if the demand is overwhelming which the internet demand of Pakistan is because it mostly used for entertainment that it is seen in 99 percent case it taxes brings negligible difference.

                • shahid ali

                  Agar hum aap ke simple logics kay sath jayen to Pakistan mei her cheeze ke khareed kum hony chahiye maslan gariyon ke balkay her cheeze ke kyon kay because of inflation price increase all the things.

                  • aamir7

                    Kuch growth markets hoti hain, kuch cheezon ka asar dosray segments par ziada hota hay aur kuch ka kam. Jiss tarah iss tax say almost sari economy hamper hogi, kiya aisi koi aur misaal hay apkay pass?

                    App azeem log hain, please ziada na sochain.

                    • shahid ali

                      aap kay pass hai koi misal jis aap apna claim back ker sakian chalen aap baray hain pehle aap batain phir mei batata hn.

                    • shahid ali

                      aur aik aur baat ye plz bilkul na kahen ya aisa bilkul present na karen kay ye plum ke reaserch mei hai ye wahan bilkul nahy hai ye aap ke apni soch hai. I just wanted to clarify this and do not want to argue as i think it is pointless because i am afraid one of use do not understand anything about economy and i respect you a lot. but a little less now after some recent posts.

            • Talha

              The research paper suggests the growth due to 3G. You have made a claim that by imposing tax the growth will reduce by 20-25%, which is not present in the paper. I want to find out from where you have pulled this figure.

        • shahid ali

          Sir please aap apna article khud dobara se parhe aap kay article ka pehla hissa jo kay plum kay reaserch kay refrences deta hai us mei aisa kuch nahy hai kay ye punjab kay liye nuksan day hai.
          App kay article ka dosra hissa jub aap baras parhtay to us wakt phir aap koi refrence nahy daitay.

          • aamir7

            I am going to ignore trolls now.

            • shahid ali

              g jawab nahy hota to ignore to kerna pare ga. But remember you have just lost a very loyal fan of your site. You are truly a biased person. I thought the otherwise

        • Ahmed Habib

          You think taxes are bad for economy? Well, you should read this www[dot]governmentisgood[dot]com/articles[dot]php?aid=17 if you like to correct youself else if this is planned campaign against govt then np, rip!

      • Khurram ShahzAd

        I can guarantee you, this blog only talks fact. I am more of voter of PTI, I also see lots of posts here where aamir and his fellows praise the current government, I am OK with it, because these are all facts.

        Please, do not start fighting when something have political hint in it. Check the facts and that start.

        If you don’t believe on stuff written above, bring some reference which suggests otherwise and than talk.

        • shahid ali

          yar aisa post batao jis mei is government ko praise kiya ho ??
          Mager news na batao aisa post jis mei government ko prasie kiya ho ? mera matlub federal government kpk ke nai.

          • Ahmed Habib

            Yar, 99% users of 3g/4g use data less than 1500 worth of cost aur tax to 1500 sy uper py lgaya gya hy. How is poor effected?? Jab cigerette py tax lagta hy to kia logo ny peena chor dya? I guess pehly sy tadad barh gai hy peeny walo ki… garian bht mehngi hain, kia log ni lety? Array, js ki zarorat hogi wo zaror lega jo marzi kr lo… Aamir ataa can not represent all 20million subscribers here without their support.

            Kamal ka blog hy, ar jb jawab na bany to main jawab ni deta etc etc. He has lost me too as a fan.

      • Umar Tariq

        long live PMLN-N long live Punjabi’s, I hope and pray that Nawaz Sharif will live another 100 years and govern Pakistan for any 100 years, Alhamdullilah we are progressing so well, power outages have been drastically reduced, water supply is good, education sector is growing fast, university from abroad are now accepting our federal and Punjab board as new Education Standards. There are so many things have been done, but not much appreciation have been given to these talented people.

  • Fahim

    Aamir instead of accent, it was the Grammar & Composition you need learn.

  • Zafar Abbas Rizvi

    have finished reading whole article. wounder full and reality based analysis. Now waiting Dr. Aamir Liaquat Hussains’s Crap replies under every comment. Come on Dude :)

    • Ahmed Habib

      You did your part? Now go to sleep again.

      • Zafar Abbas Rizvi

        So it started but some one else. Sach kehtay hyn ghalti bhaanj nahin hoti bachay deti rehti hai

  • Ahmed Habib

    Shame site is named propakistani, it is hurting now. Sure, you have right to protest against taxes forced but why you were silent when KPK forced this tax earlier??? Any news regarding that you posted?

  • Haida Kay

    Veryyy well written article and kuch he din0 main such samnay ajaeyga 0r phir yahan PRO-PTI ka r0na r0nay walay naam badal badal kr govt ki bistiaan karengay .. Lanat hai asay jahil hukmran0 per yar :-( .. l0go per bhiiii :-( …

    • Ahmed Habib

      Logo pr?.. tab to Ap pr bhi ky ap poti leage member ho

      • Haida Kay

        Yar apki phir sarr gayii ? akal hai mere bhai mey thori ya apka haal bhi metro bus stop ki roof wala he haii #AhmedHabib Saaab ?

        • Ahmed Habib

          Pakiz ka b hal ni hr chez ka hashtag bnadetyhain. Pehly khud ko thek kro phr hukumat py jana unki bat krna.

          • Haida Kay

            Sarr gayii na .. Main bilkul bhi apk0 burnol ka Mashwara nahi do0nga .. lolx

  • shahid ali

    Now this is total speculation, without any source, and above all you are giving economic speculations which is a sin for an educated person. You know basic economics ??? When demand increase price also increases and this is how your economy grows when it grows, i rounded up this simply i do not want to go in more economic detail with you as i got to know how much you understand economy, but still if you really think your post make even 1% sense you need to quit blogging..
    What is happening to this site. I used to come here to read up techs, telecos , technology and now i am getting politically motivated baseless posts.

    Okay you said this tax is bad thing i am with you it is a very bad thing, but you do not need to prove it with baseless and wrong posts after posts.

    We got it we really got it. Could we get something else now ???

  • Eli Ehsan

    in the Hindsight, PPP has done a genius move of FREE WiFI in Khi then? #JiyeBhutto #ZardariKhappay :D :D

  • Ghulam.e.Ahmed

    nashay ka aadi bana ker phir ghar bhi bikwa dena … isi tarah hota hai
    pheli poodi free phir thoda bhaa’o or aahista aahista bhaa’o badhaatay jao

  • Hassan

    heraangi ho rahi hai jahil awaam k comments perh k still pti and pmln aur politics mein parey hoey ho, agar taxes zeyada impose kerney se he mulk speed mein growth karien tu singapore and dubai jin k most of the sectors tax free hain wo tu 1000 saal pachey honey cheheye na aur ye log jo tax impose ker rahey hein khud k mahel and flats London and Dubai mein aur taxes ap aur hum awaam k leye yani hamarey paisey se he mulk agey jaey ye bas seats pe mazey lene aaien hain waisey ye awaam deserve bhe yehi kerti hai jaisy blind stupid supports hain waisa he hasher hona chahehey. chalo tax laga deya its fine ab is ki transparency imposing report kabhe milni hai ? k is se mulk k jo GDP mein increment hoa wo laga kahaan kahaan use hoa ? nahin tu lanat aisey tax pe better yehi hai k ap bhe thora aur paisa kamaien and in logon k sath london and dubai mein properties pe invest karien wahaan business register karien and 1% bhe tax deye bagair sakoon se kaam karien and ban jaien true Pakistani jo bahar baith k mulk ka dard rakhtey hein :D Holly shit. Khushi ho gi agar mera comment bhe approve ho gaya tu.

  • anas qamar

    Stick to what’s good for your country, not your Party.

  • Tayyab

    Being a regular follower of this blog, it is sad actually to see the progression of an decent news source to a news source with a clear bias now. Aamir is calling trolls; the people taking him on speculative parts of his posts and willing to talk facts. However for lack of a better alternative I will continue to follow this blog and will just have to live up with the parts where he does biased rantings.

    • Noman

      Mere brothers is country ne kuch nhi diya siwae Zulm or tax k since 1947. Pakistan pe Lanat, yahan k hukmaran pe lanat . America k tatto. Aapas main mat laro plz