GST on cellular services down in budget
STAFF REPORT IBD: Due to uniform GST the earlier GST of 19.5 per cent on cellular services/mobile phone calls has been reduced to 16 per cent in the federal budget 2012-13.
“It a sigh of relief for the telecom industry,” commented an official of a local cellular company.
The cellular industry has long been asking for the reduction in GST and removal of activation charges on mobile phone SIMs. The budget 2012-13 has finally taken care of GST but SIM activation charges are still there which are born by cellular operator.
The government is expecting that by reducing GST on telecom services, revenue will increase in the FY 2012-13. The federal government will distribute Rs. 44.596 billion as GST on telecom services among the provinces.
The government has also set non-tax revenue targets of Rs. 730.331 billion during FY 2012-13. Out this figure, Rs. 79 billion is expected to be received from the profits of PTA. The cellular industry still demands the removal of SIM activation tax.