ISLAMABAD: The Ministry of Information Technology and Telecommunication (MoITT) has proposed significant tax relief measures for mobile phone users in the upcoming federal budget for FY2026-27, recommending reductions in both advance income tax and General Sales Tax (GST) on telecom services.
According to official proposals submitted to the Ministry of Finance, the ministry has suggested gradually lowering the current 15 percent advance tax and 19.5 percent GST imposed on mobile phone and internet users. The move is aimed at making digital services more affordable and increasing access to connectivity across Pakistan.
Officials believe that reducing the tax burden on telecom consumers will help promote digital inclusion, encourage greater use of mobile and internet services, and support the government’s efforts to bridge the digital divide.
In addition to consumer tax relief, the Ministry of IT has also proposed reducing import duties and taxes on broadband equipment and telecommunications infrastructure. The ministry argues that lower costs for network equipment would enable telecom operators to expand coverage more efficiently and improve service quality nationwide.
The recommendations further emphasize the need to attract greater private-sector investment in telecommunications projects. Officials have proposed creating a more investment-friendly environment to accelerate network expansion and digital infrastructure development while reducing reliance on public-sector funding.
The ministry stated that the proposed measures are aligned with the government’s Digital Pakistan agenda, which seeks to enhance digital connectivity, expand internet access, and strengthen the country’s digital economy.
The proposals come after repeated calls from telecom industry stakeholders for tax rationalization in the FY2026-27 budget. Industry representatives have argued that high taxation on mobile services and devices limits digital adoption, discourages investment, and increases the cost of connectivity for consumers.
The federal government is expected to announce its final decisions on the proposed tax relief measures as part of the upcoming budget for FY2026-27.
