Pakistan’s mobile phone service tax rate is the highest in the region, posing a major hurdle to the Digital Pakistan vision and discouraging foreign investment, according to the GSM Association (GSMA).
The industry body has urged the government to review taxes on telecom services and operators, recommending a reduction from the current 33 percent rate.
The GSMA report noted that mobile services in Pakistan are subject to 18 percent sales tax and 15 percent advance tax.
It stated that high taxes are hampering digital growth and investment in the country. In comparison, mobile service tax rates are 26 percent in Nepal, 23 percent in Sri Lanka, 18 percent in India, 12 percent in the Philippines, 11 percent in Indonesia, 9 percent in Singapore, 7 percent in Thailand and 6 percent in Malaysia.
The report added that Pakistan’s mobile industry earns less than one dollar per user on average, compared with more than eight dollars globally. It said taxes on operators, services and devices are among the highest in the world.
