34.5pc tax being deducted on Rs100 prepaid phone card

Prepaid mobile phone users in Pakistan continue to face a heavy tax burden, with the combined tax rate reaching 34.5%, significantly reducing the amount of usable balance they receive after every recharge.

According to available figures, when a user loads Rs100 of mobile credit, an advance income tax of 15% is deducted first, resulting in a deduction of Rs13.04 and leaving Rs86.96 in the account.

A 19.5% sales tax is then applied to the remaining amount, leading to a further deduction of Rs14.19.

 As a result, the customer is left with only Rs72.77 in usable mobile balance.

Overall, Rs27.23 out of every Rs100 prepaid recharge is deducted in taxes before the customer can use the service.

Telecom experts and consumer representatives have urged the government to reduce taxes on mobile services, arguing that lower taxation would improve public access to digital services, including mobile internet, online education, e-commerce and other essential online platforms.