BUDGET 2021-22: Govt says no tax on data usage after Tarin’s speech

ISLAMABAD: The budget for the upcoming fiscal year has proposed new duties on the internet and the telecom usage, not only inviting a backlash on social media but also creating confusion as the government denied the increase.

The finance bill has proposed that Re1 per call if the duration exceeds three minutes, Rs5 per GB for internet usage and 10 paisa on each SMS has been imposed, which will be in addition to the existing rates.

However, as the news reached the general public that taxes and duties have been enhanced on the consumers, users stormed social media with criticism of the government and many even tagged the prime minister at their tweets saying that the “Budget killed digital Pakistan initiative of the PM.”

After the strong criticism of the government for making internet usage, call and SMS costlier Minister for Energy Hammad Azhar denied that additional duties have been imposed on telecom and the data usage.

In his tweet the minister said, “The PM and Cabinet did not approve the FED levy on internet data usage. It will not be included in the final draft of the Finance Bill (budget) that is placed before parliament for approval.”

The information minister told Dawn that the increase mentioned in the budget document was an oversight, because the cabinet had not approved it. He made it clear that no tax has been imposed on data use.

However, many remained critical and concerned. In his tweet Amir Ibrahim, CEO Jazz, said that the additional levy on internet is detrimental to “Digital Pakistan” journey.

Howver, he praised Finance Minister Shaukat Tarin for reducing the FED, that has been reduced from 17 per cent to 16pc, which is the standard rate for all sectors.

Mr Tarin in his budget speech announced that the federal excise duty on the telecom sector has been rationalised.

Meanwhile, senior officials of telcos said that the telecom industry will give its reaction to budgetary measures on Saturday.

“The Covid-19 pandemic has forced the world to adopt a social distancing attitude and most of the activities including buying groceries, education and even medical checkups were shifting to online mode — increasing internet rates will be damaging for whole society,” a senior executive of a telecom company said.

Similar views were expressed by a senior official of an internet service provider (ISP) who said that Pakistan was already on the 90th position in the world for internet inclusion and second lowest in Asia.

“Now if the government wants Pakistan to be at the last spot, increasing duties and taxes at internet and mobile calls was justified,” the official said, adding that Pakistani consumers were already paying exorbitant rates for data usage mainly because of high taxes and duties.