In a meeting of the Economic Coordination Committee (ECC) held last week, the Ministry of Information Technology proposed that economic policymakers should abolish 12.5% advance income tax and cut federal excise duty to 16%. At present, the telecom sector is paying 12.5% advance income tax and 17% federal excise duty on telecom services. At 12.5%, withholding tax (WHT) on telecom services is significantly higher in comparison to the tax on some other sectors. The IT ministry also proposed the withdrawal of SIM issuance tax of Rs250 on the telecom sector. However, the FBR did not support the proposals with remarks that the abolition of 12.5% advance income tax could substantially reduce the country’s annual revenue collection.

Source: The Express Tribune November 06, 2020 03:33 UTC