Pakistan’s telecom firms have assured the Federal Board of Revenue (FBR) that they’ll deactivate the mobile phone SIM cards of more than 500,000 non-filers. However, they’ve requested a timeframe of one to 1.5 weeks to accomplish this task.
In a series of meetings over three days, FBR Chairman Malik Amjed Zubair Tiwana convened with telecom company officials and representatives from the Pakistan Telecommunication Authority (PTA). The primary focus was on implementing the Income Tax General Order (ITGO) issued by the FBR, targeting 506,671 individuals who hadn’t filed their returns for the year 2023.
During discussions, the Telecom Operators Association of Pakistan spokesperson mentioned that telecom operators outlined additional technical, operational, and legal challenges in implementing the ITGO. Another meeting is scheduled to chart the way forward. However, assurance regarding SIM blocking wasn’t provided.
Initially, telecom companies resisted the idea of blocking SIMs on the first day of meetings. They highlighted that although the law to block SIMs of non-filers had existed for two years, it hadn’t been enforced rigorously. They argued against the sudden strict implementation after such a lapse.
Moreover, telecom companies pointed out that if the law mandated SIM blocking, it should also authorize actions like disconnecting power and gas supplies to non-filers.
Responding to telecom companies’ concerns, the FBR emphasized that the government had the discretion on how, where, and when to exercise its powers. It clarified that simultaneous exercise of all powers conferred by law wasn’t mandatory.
Telecom companies expressed apprehension about a potential loss of Rs50 million, which would affect both them and the FBR’s tax revenue. However, the FBR emphasized the larger goal of documenting the country’s economy, even if it meant a temporary revenue loss. They believed that once non-filers were documented, both telecom companies and the FBR would benefit financially.
Additionally, telecom companies suggested blocking 20,000 to 25,000 mobile SIMs initially and gradually expanding. They proposed freezing SIMs of non-filers one by one, especially those holding multiple SIMs.
FBR officials reminded telecom companies that the parliament had enacted a formal law regarding SIM blocking of non-filers. They emphasized that implementing the law was crucial, and strict action would be taken against violators.
In the meetings held on Monday and Tuesday, telecom companies expressed willingness to comply with the decision to block SIMs of non-filers, seeking time to devise practical solutions.
My Opinion:
The collaboration between telecom companies and the FBR to address tax evasion through SIM blocking is commendable. While challenges exist, it’s crucial to uphold the law to ensure fairness and accountability in tax compliance. However, it’s essential to mitigate any adverse impacts, especially on businesses, through careful planning and implementation. Overall, this initiative signals a positive step towards strengthening the country’s tax system and promoting financial transparency.
