Tax on mobile top-ups to be restored from today

Tax collection on mobile phone cards may generate Rs7.5 billion a month.

ISLAMABAD: Taxes will be charged on all mobile phone top-ups from Saturday (today) as per the Supreme Court’s order. Thereby, mobile phone users will receive only Rs77.19 on a recharge of Rs100.

Earlier this week, the apex court allowed cellphone service providers to deduct levies on top-up of prepaid cards months after stopping them from tax deduction.

The apex court, while reserving the verdict in the case, issued a short order taking back the interim order issued in June last year which barred cellphone service providers to charge taxes on mobile top-up.

A three-member bench of the SC headed by Chief Justice Asif Saeed Khan Khosa gave a verdict on the revised deal on April 24 that the SC will not intervene in public revenue and tax collection matters pertaining to advance tax on mobile phone top-up card case.

In June, 2018, a SC bench headed by then CJ Nisar had suspended the deduction of taxes imposed on the top-up of prepaid cards by cellphone service providers and the Federal Board of Revenue (FBR).

Former CJP Saqib Nisar had questioned how a person who doesn’t fall within tax net is made to pay taxes on mobile phone top-up. Tax should be levied from a person whose cell phone use exceeds the fixed limit, he added.

During the hearing of the appeal, the court remarked that tax have been collected from millions of people who are ineligible to pay it.

Also read: SC restores tax collection on mobile phone cards

Justice Qazi Faez Isa asked that whether the SC had taken notice on the reasons of suo moto and concerned authorities were asked to explain? The Chief Justice replied that now it is not possible for the court to proceed to the start up.

Tax collection on mobile phone cards may generate Rs7.5 billion a month.