ISLAMABAD: In a recent development, the Federal Board of Revenue (FBR) has imposed a 15 percent income tax on the sale price of prepaid phone cards.
This decision comes as part of the FBR’s latest withholding tax rates for the fiscal year 2023-24, which includes amendments introduced through the Finance Act, 2023.
The FBR is responsible for the collection of taxes on telephone and internet services under Section 236 of the Income Tax Ordinance, 2001. As per the new regulations, the 15 percent income tax will apply to subscribers of internet, mobile telephone, and prepaid internet or telephone cards.
Specifically, the tax will be calculated as 15 percent of the amount of the bill or the sales price of the prepaid internet card or prepaid telephone card, irrespective of the mode of sale, whether through electronic mediums or otherwise.
Furthermore, the FBR has outlined the tax rates for telephone subscribers, excluding mobile phone subscribers, whose monthly bill exceeds Rs. 1000. For such cases, the tax rate will be 10 percent of the exceeding amount of the bill.
This move by the FBR is aimed at expanding the tax net and ensuring a fair contribution from users of telecommunication services. By introducing income tax on prepaid phone cards and increasing the tax rate for high-value bills, the FBR aims to enhance revenue collection and promote tax compliance in the telecommunications sector.
Consumers and businesses alike are advised to be aware of these new tax rates to avoid any potential penalties or issues related to non-compliance. The FBR encourages everyone to review their phone bills and prepaid card purchases diligently to ensure accurate tax deductions in accordance with the latest regulations.
If there are any inquiries or concerns about the new income tax rates on prepaid phone cards, individuals and businesses can reach out to the Federal Board of Revenue or consult with tax professionals for guidance and clarification. Staying informed about these tax changes will not only ensure adherence to the law but also contribute to the country’s economic growth and development.
