Mobile phone companies, in a joint letter signed by CEOs of all local operators, thanked Mian Shahbaz Sharif, Chief Minister Punjab, for removing internet taxes. Telcos, in the same letter, committed massive investments in the sector during next four years.
According to details, a recently sent letter paid gratitude to CM Punjab for listening to industry’s input and other stakeholders on the matter and reversing 19.5% internet tax that was imposed by Punjab Revenue Authority for internet usage in the province.
Letter said that sales tax on data services imposed by Punjab — largest province with around 60% of Pakistan’s population — was a major barrier to proliferation of next generation cellular mobile services because it restricted access and usage by reducing affordability.
Telcos said that tax could have led to higher cost of operation and reduced returns to capital employed and investments for mobile phone operators, thus hindering the growth of the sector and development of new and more inclusive services for users.
“We are grateful that you with your personal intervention the sales tax levied on data services has been withdrawn”, read the letter.
Mobile phone companies committed that removal of internet tax will encourage the efficient rollout of high capacity mobile broadband networks that will spur further investment and socio-economic growth for industry in general and for the people of punjab in particular.
Telecom operators said that they have allocated around $4 billion to be invested in Pakistan that will majorly be spent on network expansion and rollout of 3G/4G networks in the country during next three to four years only.
It is pertinent to mention here the Khyber Pakhtoonkhawa and Sindh are still charging 19.5 and 18.5 percent GST on mobile broadband internet DSL,EVO, 3G/4G and WiMax.
Shahbaz Sharif, at the time of withdrawal of internet tax, had urged other provinces to do the same.