Pakistan Among Highest Taxing Countries on Mobile Services, Report Reveals

Lahore (KNN) — Pakistan has emerged as one of the countries imposing the highest taxes on mobile services, with the combined sales and turnover tax on the sector reaching 37 percent, according to a new report by global economic research firm Frontier Economics.

The report described the heavy taxation on Pakistan’s mobile sector as a major obstacle to growth and digital development. It stated that mobile consumers in Pakistan currently face a 19.5 percent sales tax, a 15 percent advance income tax, and a 2.5 percent regulatory duty on mobile services.

In addition, mobile companies are subject to a 29 percent corporate tax along with a 10 percent super tax on profits, significantly increasing the overall tax burden on the telecommunications sector.

Frontier Economics recommended reducing the total 37 percent sales and turnover tax on mobile services to 17 percent. The report also proposed completely abolishing the 15 percent advance income tax charged to consumers.

Furthermore, it suggested cutting the 2.5 percent annual regulatory duty to 1 percent and reducing the general sales tax from 19.5 percent to 16 percent.

According to the report, lowering taxes on mobile services could help boost Pakistan’s digital economy, expand mobile internet usage, and increase government revenues in the long term through greater economic activity and broader digital inclusion.