Mobile phone service providers have started the implementation of a Supreme Court order to remove service/maintenance charges on pre-paid cellular scratch cards. The apex court had told mobile phone service providers that they could apply a 12.5 percent withholding tax. However, the court had told them to abolish the 10 pc administrative/service charges.
SC suspends tax on mobile cards
It appears that 10% service/maintenance charges on every Rs. 100 card has now been withdrawn. Now, mobile network users will have to pay 12.5% withholding tax and 19.5% FED, which is still applicable on every top-up and balance transfer.
It is prominent to note here that the former CJP, Justice Saqib Nisar had suspended all top-ups taxes last year in June. Then the court-ordered FBR and telecom companies to regulate new rules to tax consumers on mobile top-ups cards. At that time some mobile network consumers were getting Rs. 61.93 balance in the mobile account on Rs. 100 recharge.
As of now, the mobile phone users will get around Rs. 88 instead of RS. 76.94. balance in their mobile account after recharging an Rs. 100 scratch card.
All the mobile network operators in Pakistan including Jazz, Telenor, Ufone, and Zong have officially started applying the new tax rate on mobile top-ups.