FBR sets 10% tax on qualifying telephone bills and 15% on internet, mobile and prepaid services for Tax Year 2027
ISLAMABAD: The Federal Board of Revenue (FBR) has issued the withholding tax card for telephone and internet services for Tax Year (TY) 2027 under Section 236 of the Income Tax Ordinance, 2001.
The withholding tax rates have been updated up to June 30, 2026, covering telephone subscribers, mobile phone users and subscribers of internet and prepaid telephone or internet services.
10% tax on qualifying telephone bills
Under the FBR’s withholding tax card, a 10% withholding tax will apply to the amount of a monthly telephone bill exceeding Rs1,000 for subscribers other than mobile phone users.
The tax is calculated only on the portion of the bill above Rs1,000 rather than the entire monthly bill.
For example, if a qualifying monthly telephone bill is Rs1,500, the withholding tax would be calculated on Rs500 rather than the full Rs1,500.
15% tax on internet and mobile services
For internet subscribers and mobile telephone subscribers, the withholding tax rate has been set at 15% of the bill amount.
The same 15% rate applies to users of prepaid internet or telephone cards. In such cases, the tax is calculated on the sale price of the prepaid card.
The rate also applies to the sale of units through any electronic medium or in any other form.
Withholding tax rates for telephone and internet services
| Category | Tax rate |
| Telephone subscriber, other than mobile, monthly bill exceeding Rs1,000 | 10% of amount exceeding Rs1,000 |
| Internet subscribers | 15% of bill amount |
| Mobile telephone subscribers | 15% of bill amount |
| Prepaid internet or telephone cards | 15% of sale price |
| Sale of units through electronic medium or any other form | 15% |
Rates prescribed under Income Tax Ordinance
The withholding tax rates are prescribed under Division-V of Part-IV of the First Schedule, read with Rule 10(l) of the Tenth Schedule to the Income Tax Ordinance, 2001.
The FBR said the updated tax card is intended to facilitate taxpayers, withholding agents and other stakeholders in determining the applicable withholding tax rates for Tax Year 2027.
The latest card provides a consolidated reference for withholding obligations on telephone, mobile and internet services during the tax year.