The Supreme Court on Tuesday directed the federal and provincial governments and the cellular companies to file reply within one week on high levy charged on mobile phone cards. A four-member bench headed by Chief Justice Mian Saqib Nisar was hearing a suo motu notice, which the CJP had taken on high levy charged on mobile phone cards in the country.
The Chief Justice noted that 42 percent is charged from the cell phone users. "Why such a huge levy is deducted by the private mobile companies and under what tax heads is it?" the CJP asked. Attorney General for Pakistan Ashtar Ausaf explained that the levy is charged under the Customs Act 1969. He informed that out of 42 percent includes withholding tax 12.5 percent, sales tax 19.5 percent and the service charges, 10 percent. He further informed that 12.5 percent goes to the federal government, and 19.5 percent goes to the provincial governments, and 10 percent is charged by the cellular companies.
The counsel for the cellular companies informed that diplomatic mission, diplomats and the government officials are exempted from paying withholding and the sales taxes on mobile charging. He told that the number of mobile phone users in Pakistan is 144 million as compared to 142.5 million in October 2017. The Chief Justice observed that it is exploitation. He said if a laborer who hardly earns Rs 200 per day has a cell phone and keeps it for talking to his relatives then why he has to pay withholding and sales taxes.
Justice Ijazul Ahsan said this is not lawful extraction from the poor people, while the tax-payers in the country are not more than 300,000.
The court also directed the mobile companies' counsel to apprise what the rate of call is in other countries. The case was adjourned until next week.