Taxes, duties and regulatory charges – Telecom sector contributes Rs. 100 Billion annually

Taxes, duties and regulatory charges – Telecom sector contributes Rs 100 billion annually
ISLAMABAD (July 8, 2011) : Contribution of telecom sector to national exchequer through taxes, duties and regulatory charges is growing and the sector has been contributing over Rs 100 billion annually since last few years.
At the end of FY 2010, the total contribution was over Rs 109 billion of which almost 50 percent came from GST.
In the first half of the FY 2011, the total contribution to national exchequer was Rs 56.3 billion which was almost Rs 49 billion in the first half of FY 2010, showing growth of 15 percent since last year.
According to an estimate, telecom sector contributes more than 90 percent share in total taxes by the services sector of Pakistan, which is being diverted to provinces under 18th Amendment. Similarly share of GST in total contribution from telecom sector is also very impressive where almost 50 percent of total contribution comes from GST collection.
According to official data available, in the first half of FY 2010-11, total GST collection is Rs 23 billion, which was Rs 21 billion in the same period of FY 2010. GST collection in telecom services mainly comes from mobile sector and its share in total GST collection is 86 percent followed by basic services as 11 percent.
The activation tax contribution to national exchequer stands at Rs 3 billion at the end of first half of FY 2010-11, which was Rs 4 billion in the same period last year. Main reason for drop in the activation tax is due to market maturity.

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