KP Government Likely to Remove Internet Taxes

Khyber Pakhtunkhwa government is likely to remove 19.5 percent sales tax currently applied to fixed and mobile broadband services in the province, it is learnt.

Official sources revealed ProPakistani that Information Technology Board Khyber Pakhtunkhwa has drafted the recommendations and sent to Chief Minister Pervez Khattak for final approval.

According to documents available with ProPakistani, KP Information Technology Board has recommended that the revision on internet taxes may be made on following terms:

  • Data services to be exempted from sales tax on fixed broadband internet for usage under Rs 2500 per month and for up to 8 megabits per second (Mbps) connections;
  • Data services are to be taxed at the existing rate of 19.5 percent sales tax on fixed broadband internet for usage above Rs 2500 per month and for connections above 8 Mbps connections;
  • Data services to be exempted of sales tax on mobile broadband internet for usage under Rs 2500 per month.

Managing Director (MD) Information Technology Board Dr. Shahbaz Khan said that to facilitate information technology businesses and economic growth in the province, KP government had started working for revising the 19.5% sales tax on broadband internet.

“The final plan has been submitted for approval to Chief Minister Khyber Pakhtunkhwa for revising the sales tax on internet. After the approval of Chief Minister 19.5 percent sale tax on Internet would be revised”, said Dr. Shahbaz.

MD further said that the proposed revision of tax on internet would help small businesses to flourish in the province. Further, the move would help in encouraging the cellular operators in rolling out 3G and 4G services in the province. He said that recommendations were prepared in consultation with all stakeholders including Pakistan Telecommunication Authority (PTA).

Punjab has already withdrawn 19.5% sales tax on mobile and wireless internet, fixed line internet and other forms of internet, while Sindh also relieved some of the taxes on internet and telecom.

KP imposed 19.5% taxes on all sorts of Internet (DSL, EVO, 3G, 4G, WiMAX) in 2014.

All the stakeholders including general public, PTA, telecom operators etc were demanding KPK since long for removing tax on broadband internet and data services on mobile phone to give relief to masses.

The mobile operators had written a joint letter to CM Khyber Pakhtunkhwa earlier in June 2015 urging the provincial government to waive off general sales tax (GST) on internet and data services which is slowing down the penetration of 3G and 4G technologies throughout the province.

According to experts tax rate on telecom services in Pakistan is around 40 percent which is one of the highest effective tax rates in the world. In addition to taxes, 19.5% GST on mobile broadband and data services simply adds to the burden on consumers.

    • Propakistani is very much PooTI, they break the “news” even before Punjab government actually tax the internet and they break the “news” again even before KP government withdraw the tax.

  • 8mbps limit makes no sense. ISPs will not have any reason to provide more than 8mbps in 2500. Sindh Govt included this illogical limitation and now KPK doing the same.

    KPK should remove the bandwidth restriction and just set a tax after 12000 rupees so that small businesses who buy internet for 5-10 person offices don’t suffer.

    • Haters will say …announce it once it is done ;)
      Such gimmicks may earn public favor as it is easy to do an year before election but for almost four years they couldn’t achieve anything in KP.

      • ok so lets assume he does [email protected](which he doesn’t because a podri vs Ik) whats it to you he is harming his self merely but on the other side you have beghairat ganjas looting the jahil(excluding a few) pakistani awam and buying palaces with your(Patwaris) support.

  • Thanks to punjab govt who have set such high standard benchmark and opponents are following them PMLN is doing much better than pti

    • They have set high standards that is why demands from them is higher while PooTI even if launches “mobile courts” becomes miracle done with no questions asked later to know its current status.

      • While both the parties are actually atleast doing something, I suggest you to take some English courses so you can better criticize ‘PooTI’ as you love to call them. Apnay giraiban me jhankna seekho pehle.

    • You mean to say good decision by Ganjay ab KPK Govt ko b jaag jana chahiye. As there is already no tax in Punjab on internet

      • o bhai , kis ne kaha no tax? i am paying tax on Landline internet services as WithHolding tax

        • I think you didn’t read article or you are so illiterate to understand difference between withholding tax and service tax.
          The withholding tax you are paying is advance tax deducted by federal Govt which you can claim or adjust against payable tax at the time of filling tax return. It is same tax that deducted at the time of mobile recharge. And this tax is applicable since ages now.
          Tax that is being discussed here is service tax charged by provinces. A 19.5 tax charged by provinces on all cellular services like call, sms, data and other value added service. This tax was not applicable on data services before 2014 and provinces imposed it on data services in 2014.
          Punjab was first to remove this tax on data services to promote data services in Punjab. But other provinces including your beloved KPK Govt still milking customers for 20 Rs. Againat every 100 for data services.
          Give credit where its due and criticize where it is due, regardless of political affiliation. Don’t be so dumb!

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