The government has revised the Finance Bill, requiring FBR to conduct hearings before penalizing telecom operators for non-compliance with Income Tax General Orders (ITGO).
Previously, telecom companies faced direct fines for failing to block SIM cards of individuals who haven’t filed income tax returns. Under the new amendments, FBR will hold hearings to assess a company’s efforts in blocking such SIMs. Only if a company fails to demonstrate sufficient compliance will a fine be imposed.
The revised fines have also been reduced from Rs. 100 million and Rs. 200 million every fortnight to Rs. 50 million and Rs. 100 million for the same period.
The financial impact on the telecom sector remains unclear, with potential revenue losses depending on the number of SIMs affected by FBR’s ITGO. Industry sources have expressed concern, and telecom operators previously requested the amendments’ withdrawal.
They argue that their role is not to enforce tax collection and their systems lack the ability to distinguish between compliant and non-compliant filers. Implementing such changes for over 180 million subscribers is seen as impractical.
The Senate Standing Committee on Finance has urged the government to review the fines and engage with telecom operators to address their concerns. This revised approach aims to strike a balance between tax collection and the operational challenges faced by the telecom sector.
