Telcos Unite Against Government for Plans to Tax SIM Cards and Handsets

Mobilink, Telenor and Warid have said that the Federal Board of Revenue’s procedure for imposition of sales tax on SIM cards and handsets, is unconstitutional and practically almost impossible to implement in the manner laid down by the board.

These companies said that the scheme of taxation of handsets as set out by the FBR is irrational, illogical, arbitrary and incoherent.

The new sales tax regime will lead to an increase in handsets with dummy IMEI numbers in addition to an increase in overwriting of IMEI numbers with the object of avoiding the tax, said the companies.

Telenor, Mobilink and Warid had made detailed submissions on the practical issues in relation to the implementation of the tax imposed by way of the Ninth Schedule read with Section 3B of the Sales Tax Act, 1990.

The present submissions aim to cover some of the fundamental legal issues in the implementation of the tax under the Ninth Schedule while recapping some of the practical problems that make it impossible to get the tax regime implemented.

The Ninth Schedule taxes two items i.e. SIM cards and handsets. Before the introduction of the Ninth Schedule by way of the Finance Act, 2014, only the import and supply of handsets was being taxed but there was no special taxes on the import and supply of SIM cards.

The CMOs’ current technical and human resources are not capable of implementing the tax regime and they will have to incur costs running into hundreds of millions of dollars in capital expenditure in addition to huge operational costs on account of human resources for complying with, the tax regime.

The new regime sought to be implemented will not solve the Government’s problem at all. It will lead to an increase in handsets with dummy IMEI numbers in addition to an increase in overwriting of IMEI numbers with the object of avoiding the tax. Not only will the entire purpose of this new regime stand defeated, but it will also lead to tracking issues for law enforcement agencies if IMEI numbers are forged. The only solution for the Government is to crack down on smuggling and charge sales tax at the import and supply stage, joint representation said.


  • Unconstitutional….My Foot!!
    Government should crackdown on chinese/fake IMEI no. mobile phone sales and tax the telecom sector as heavily as they could instead of putting extra taxes on LUXURY items like Milk, butter and eggs etc.
    i fail to comprehend how an individual can afford to have a mobile phone but not enough money to purchase food for himself or family.

    • shahzad

      Bahi lagta hay bohat pee lee app nai.Pehle hai itne mahanghe set bikte hae aur kitne mahange karne hay.

    • nabeel

      very well said

    • Rickshaw wala

      Taxing connectivity is the most illogical thing to advocate. Not every individual is owning an iphone and millions of subscribers have very cheap handsets which allow them to conduct their daily business, stay connected with family and the world in general. Do you want the government to tax a taxi/rickshaw guy who extensively uses phone calls to get clients for his living (bread earning)? Sure! Lets kill the eggs for this poor guy because he is alive and must be able to afford it!

    • Zawyar Ur Rehman

      HERE’S THE PROBLEM! RIGHT HERE!
      Wrong mindset :
      Milk , eggs , bread etc. Required items,
      Internet : Luxury item
      Right mindset :
      Milk, eggs, bread, education, internet etc. Required items.

      Havent you read the story of the RICKSHAW DRIVER who made SIX digits a months all due to INTERNET??! Cant you see its a world of opputunities?!

    • Ishtiaq

      We all are ready to pay taxes the very next day when Ishaq Samdhi, Twin Shareefs , all MNAs, MPAs, Senators, FBR Officers and Bureaucrats start paying their utility bills from their own salaries and income. They all get unlimited fuel, unlimited utility bills, unlimited travel allowance, medical allowance, marriage allowance, divorce allowance, rain emergency allowance, Goat sacrifice allowance on EIDs, and TA , DA and what not? plus commission and under the table income and 101 ways of looting and plundering the public taxes money. So of course they have no problem with taxes of any kind because they don’t have to pay a penny from their own pocket not even the tea n food being consumed in their offices and houses and farm houses.

      I guess you are son of one of those high ups that’s why tax seem no problem for you but rest of us do have problem, how more they will make our country corruptistan? and rule at the cost of poor people’s life? go ask a common man how many taxes he has to pay everyday and what he gets in return?
      and you came up with these lame arguments to lay dung here? go shit somewhere else and that too on public expense.

    • Ishtiaq

      We all are ready to pay taxes the very next day when Ishaq Samdhi,
      Twin Shareefs , all MNAs, MPAs, Senators, FBR Officers and Bureaucrats
      start paying their utility bills from their own salaries and income.
      They all get unlimited fuel, unlimited utility bills, unlimited travel
      allowance, medical allowance, marriage allowance, divorce allowance,
      rain emergency allowance, Goat sacrifice allowance on EIDs, and TA , DA
      and what not? plus commission and under the table income and 101 ways of
      looting and plundering the public taxes money. So of course they have
      no problem with taxes of any kind because they don’t have to pay a penny
      from their own pocket not even the tea n food being consumed in their
      offices and houses and farm houses.

      I guess you
      are son of one of those high ups that’s why tax seem no problem for you
      but rest of us do have problem, how more they will make our country
      corruptistan? and rule at the cost of poor people’s life? go ask a
      common man how many taxes he has to pay everyday and what he gets in
      return?
      and you came up with these lame arguments to lay dung here? go shi* somewhere else and that too on public expense.

  • RT

    there’s really no regulation system in this country. #thuglife