The Pakistan Telecommunication Authority (PTA) is planning to enlist the services of tax consultants to propose an efficient and effective tax model for the telecom sector and revise the tax structure for cellular companies. The PTA aims to hire tax consultancy services that cover several key tasks.
These tasks include providing tax advice on the existing tax structure, contractual arrangements, and the PTA’s position within the telecommunication industry. The consultants will propose the most tax-efficient and effective model for accounting and determine the tax status of various PTA matters with tax authorities and forums.
The scope of the tax services includes the preparation and filing of corporate tax returns, computation of income and sales tax, filing refund applications if applicable, attending tax authorities’ proceedings and responding to notices, providing assistance with tax credits, and handling day-to-day correspondence with tax authorities.
The PTA’s primary role is to regulate the telecom industry in Pakistan, issue licenses, and establish a fair regime in the sector. Additionally, the PTA is responsible for collecting fees from operators providing telecom services and is subject to taxation according to the Finance Act 2006.
Pakistan’s telecom market currently imposes a total tax burden of 34.5% on telecom users, including 15% advance income tax (AIT) and 19.5% GST. This makes it one of the highest-taxed telecom markets globally and the second-highest in South Asia. Such high taxation on telecom services hinders the country’s digitalization efforts.
Recognizing the significance of affordable mobile ownership and internet access for the economy’s digital development, including education, health, and commerce, officials are taking a proactive approach to address these tax concerns and promote digitization in Pakistan.