About a month ago when the Senate Standing Committee on Finance expressed their annoyance on the FBR for not collecting tax properly. The Federal Board of Revenue (FBR) admitted that the body was unable to collect exact amount of withholding tax from telecom operators in Pakistan because the operators don’t share their customers’ data with the tax collecting body.
It is now reported that the FBR has developed a software to collect data from all 4 telecom operators in Pakistan. At first, the operators showed their reluctance to share data with FBR but later on with the intervention of Pakistan Telecommunication Authority (PTA) the issue was solved. The Authority has officially bound the operators to cooperate with FBR.
Here’s what an FBR representative had to say on this:
The companies were reluctant to share the data with the FBR describing huge customer base and confidentiality as the reasons but the matter has been resolved after involving the PTA. Ufone, Telenor and Mobilink have started providing data for the last three months. A specialized software has been developed for this purpose that will help collect biweekly data of telecom customers.
It seems like companies were collecting withholding tax from their customers but they were not depositing it into the tax pool. Here’s what Senator Saud Majeed of PML-N had to say on this:
This money is collected from the customers but why are the companies adding it to their own pool of resources?
Earlier Senator Shahi Syed also suggested during the meeting that FBR should devise a mechanism for not collecting tax from customers using Rs. 500 or lower balance.
The development of the new software is a positive step by FBR as they will now be accurately collect taxes from all telecom companies. The data will be collected on biweekly basis from the companies.