Govt Considers Telecom Industry a Cash Cow According to Experts

Telecom sector is seen as a cash cow, as the government believes it is only a service for the rich. This was stated by Aslam Hayat, a telecom sector expert.

‘Unpredictability regarding tax policy did not allow the industry to come up with its business plans effectively. Government had time and again assured the sector for giving it the status of industry which has never been materialized,’ said Hayat while addressing a high level pre-budget consultative meeting arranged by Sustainable Development Policy Institute (SDPI).

He further said that government has admitted that GST of 14% on telecom sector is unjustified, & promises were made to abolish it. During the 4G & 3G auctions, the Telecom sectors were slapped with a surprise 10% tax, he added.

Lowest Tariff With Highest Taxes in The World

Hayat further said Pakistan’s telecom sector is now the lowest tariffed sector in the world, but also the highest taxed in comparison to other countries. Telecom sector is reaching the bottom of the pyramid & promoting efficiency in all other sectors.

He urged the government to eliminate the element of double taxation in the industry as well as different tax systems across the provinces as the service being provided was nationwide.

The session was also attended by experts representing Telecom, textile and energy sector who suggested the federal government to redress the element of unpredictable taxation policy, lack of continuity across provinces and irrational investment policies in energy sector. They were also of view that these steps would be of fundamental importance to revive industry and hence to boost overall national economy.

Textile Industry’s Issues

Syed Ali Ahsan, Chairman All Pakistan Textile Mills Association (APTMA) Punjab, while highlighting the issues being faced by the textile sector said that high cost of business, lack of institutional support, non-implementation of government polices as well as non-availability of raw material were some of the factor rendering the industry incompatible in international and local markets. He lamented that the industry was not benefited from the textile package that government had announced due to certain reasons.

Shahid Sattar, expert in energy sector exclaimed that the present government had announced 20 points to revive the energy sector at its inception whereas only 3 of them have been actually implemented. He said that the government must revisit its own manifesto so that it may come up with better policies on energy sector.

Government Policies Affecting Cost of Business and Employment

He said that government should consider the economic impact of its policies in energy sector as high cost of business would have huge negative impact on industries and hence employment. He said government should also concentrate on developing indigenous resources of energy as import option would not remain sustainable for a longer period of time.

Dr. Abid Qaiyum Suleri, Executive Director SDPI on the occasion said that various sectors of our economy were facing number of challenges including various complexities in tax systems. He said that as an independent think tank, SDPI was aiming to provide the government and relevant bodies including Ministry of Finance and Federal Bureau of Revenue inputs to reform economic policies based on the recommendations of the stakeholders.