Daily Times

KARACHI: The solid majority of cellular consumers in Pakistan are not in favor of the Chief Justice of Pakistan (CJP)’s proposal to collect dams’ fund by re-imposing Withholding Tax (WHT) on balance upload, it has been observed.

Many of them were of the view that revenues generated from additional taxes will not be utilized purposefully, but it steals a relief from the public with very limited income resources amid high inflation scenario.

In the conducted survey Daily Times discovered that customers believe that they voluntarily contributed to the dams’ fund already and will continue to show generosity as per their affordability, however imposing tax for the same purpose might lower their consumption of telephony and internet services.

Recently, the CJP of Pakistan Saqib Nisar suggested re-imposing tax on mobile phone services in order to generate revenues for the construction of dams. The re-imposition of tax will generate an additional amount of Rs 3 billion per year, which the SC had removed in June this year.

Khurram Zia Khan, a mobile phone user, said the resources for dams fund should be collected from other resources rather than imposing taxes from additional taxes. “The revenue generated under such heads was historically misused whilst their burden remains on the shoulder of the public for long period”.

He recalled that the federal government imposed a Re 1 war tax after the fall of East Pakistan but it was continued to be collected till early 2000 whilst the revenue under this tax was utilized on the anonymous purposes.

Aslam Shah, a local Journalist, said re-imposition of WHT on the name of dam fund will provide legal ground to governments for imposing undue taxes on poor mobile consumers in future. He was of the view that instead of imposing WHT on mobile consumers, the government should term contribution of Rs10 by every CNIC holder mandatory.

Similarly, Kokab Iqbal, Chairman Consumer Association of Pakistan (CAP), while lauding the CJP’s efforts to collect donations for dams’ construction said poor mobile users have already carried much burden of the taxes, now the burden must shift to rich.

“Mobile users are from every section of the society including plumbers, electricians, laborers, executives, etc and asking them to donate in dam funds would not be rational”.

Iqbal, while suggesting a viable option, said the government should ask mobile companies to impose WHT only on frequent users who use more than Rs 4000 in a month.

This scribe also observed that hundreds of mobile consumers on social media, reacting to the said proposal, have been opposing the re-imposition of WHT on mobile phone prepaid cards.

It is pertinent to mention here that supreme judiciary not only removed the 12.5 percent withholding tax on balance top-up but it also abolished 8 to 10 percent services charges of mobile phone companies in June. Mobile phone customers of different provinces pay 18.5 percent to 19.5 percent GST on calls, SMS and its related packages.

Mobile phone companies always demand the government to reduce taxes on cellular phone services to benefit the customers, an official of the mobile phone companies said.

Not only the consumption of the cellular phone services increases due to lower tax regime, but the increase in the service utility spells into the improved contribution to the economy, he added on the condition of anonymity.

On the other hand, some of the customers are generous to accept wholeheartedly the re-imposition of taxes on the balance upload.

Though the revenue generated through re-imposition of taxes will not be enough for the construction of dams but it contributes quiet well for this purpose. Users with high utility of cellular phone services could pay taxes for the dams’ fund and their affordability will not be hurt, said Nasir Taimoori, another customer.

Published in Daily Times, November 30^th 2018.