The telecom sector has urged the government to reduce the sales tax on telecom services from 19.5% to 16% in the upcoming budget, aligning rates nationwide. It also called for the abolishment of advance income tax on license auctions and simplification of withholding tax procedures, which are adding to operational and compliance burdens.
The sector also demanded reinstatement of adjustable advance tax to support consumers below the taxable threshold and proposed that the 4% withholding tax under section 153 be made adjustable instead of minimum tax. They requested an extension of the minimum tax credit carry forward period from 3 to 5 years, citing the long return on investment cycle in telecom.
Further proposals included removing regulatory duties on non-local telecom power equipment and excluding telecom services from retail pricing rules, as they do not import goods for direct sale.
Aamir Ibrahim, CEO Jazz and Chairman of the Telecom Operators Association, stressed that heavy taxation hampers affordability, investor confidence, and digital growth. He called for recognizing telecom as a critical utility—enabling education, healthcare, entrepreneurship, and e-commerce—and urged fiscal policies to support its role as a driver of national development.