Good News! Tax Not Imposed On Mobile Cards In Mini Budget

Earlier there were reports that the federal cabinet has approved imposing 30 per cent tax on mobile cards.
Lahore (WebPaki/ Pakistan News – 23rd January, 2019) The Federal government has withdrawn its decision to restore tax on mobile cards.

The matter will again be considered in June.

Earlier there were reports that the federal cabinet has approved imposing 30 per cent tax on mobile cards.

The mini budget will restore 30 per cent tax on mobile cards, reports said.

With the restoration of tax, the subscribers will now get Rs 70 on a recharge of Rs 100.

However, the mini budget presented on Wednesday upheld Supreme Court’s decision to suspend taxes on mobile cards.

The Supreme Court had on June 11, 2018 suspended recovery of withholding tax, excise duty and service charges on mobile-phone recharge.

On the charge of a Rs100 prepaid mobile card, a 19.5% federal excise duty was charged along with 12.5% withholding tax and 10% service/maintenance charge.

The three-member bench, headed by former Chief Justice Mian Saqib Nisar, had passed the orders while hearing suo motu notice over deduction of high tax/other charges by mobile companies in Pakistan.

The government on Wednesday announced an incentive package to boost manufacturing and exports, encourage low-cost housing and facilitate agricultural financing to boost economic activities, besides promoting ease of doing business, simplifying procedures for setting up businesses, and cutting taxes and duties in diverse sectors.

Introducing the Finance Supplementary (Second Amendment) Bill, 2019 in the National Assembly, Minister for Finance Asad Umar said it was not a new budget but was an economic reform package aimed at laying strong foundation for the country’s economy.

He said in order to promote local industry and boost exports, import duty on hundreds of raw items used for manufacturing were being reduced or exempted.

He said it had also been proposed to reduce the tax rate on interest income on bank loans taken by Small and Medium Enterprises (SMEs) companies from existing 35 percent plus 4 percent supper tax to net 20 percent.

Similarly, he said, the government was committed to boost agriculture and construction sectors, as during first six months of its tenure, the agriculture loans had increased by 22 percent. It had proposed to reduce the tax rate on the interest income on agriculture loans, he added.

Likewise, the minister said, the tax rate on the interest income for loans for building small homes had been cut down to 20 percent from 39 per cent.

He said ban on purchase of small vehicles with engine capacity of up to 1300 CC for non-filers was also being withdrawn, however, tax rate for non-filers on purchase of the vehicles was being increased.