The Ministry of Information Technology and Telecommunication has proposed a series of tax relief measures for the telecom sector, including exemptions from withholding tax and lower tax rates for mobile and internet users.
Sources told ProPakistani that the ministry has formally recommended to the Ministry of Finance that the tax burden on telecom operators be reduced to improve the business environment and support growth in the sector.
The current tax collection mechanism, which covers nearly 65,000 telecom sites nationwide, increases operational costs and creates additional administrative burdens for telecom companies.
To address these concerns, the ministry has proposed replacing the existing withholding tax framework with a direct tax collection mechanism. The move is intended to simplify compliance requirements and reduce the cost of doing business for telecom operators.
The recommendations also include streamlining tax procedures and granting withholding tax exemptions to facilitate investment and ease of doing business. In addition, the ministry has suggested reducing import duties on telecom equipment and broadband infrastructure to support network expansion and improve digital connectivity.
Sources further said the ministry has proposed lowering the 15 percent advance tax currently charged on mobile and internet services. It has also recommended simplifying the overall tax regime to attract fresh investment into the telecom sector.
The ministry has additionally suggested that future telecom infrastructure projects should be financed through private-sector investment rather than relying on government funding.
