If you use mobile phones, landlines, or internet services in Pakistan, you are already paying advance income tax—often without realizing it. For tax year 2026, the Federal Board of Revenue (FBR) continues to collect this tax under Section 236 of the Income Tax Ordinance, 2001.
This guide explains who pays, how much is deducted, where it appears, and whether it is adjustable or final.
What Is Section 236?
Section 236 authorizes the FBR to collect advance income tax on:
📞 Telephone bills
📱 Mobile phone usage
🌐 Internet bills
💳 Prepaid cards (mobile & internet)
🔌 Sale of units through electronic means
The tax is deducted at source, either through your monthly bill or at the time of recharge.
Who Collects This Tax?
• Telecom operators
• Internet service providers (ISPs)
• Sellers of prepaid cards or electronic units
The tax is charged in the same manner as service charges and shown on the invoice or recharge receipt.
Tax Rates on Telephone & Internet – 2026
📞 Landline Telephone Subscribers (Non-Mobile)
| Monthly Bill | Tax Rate |
| Up to Rs. 1,000 | No tax |
| Exceeds Rs. 1,000 | 10% of the exceeding amount |
📱 Mobile, Internet & Prepaid Users
| Service Type | Tax Rate |
| Mobile phone bill | 15% of bill amount |
| Internet bill | 15% of bill amount |
| Prepaid mobile card | 15% of sale price |
| Prepaid internet card | 15% of sale price |
| Electronic units / digital recharge | 15% of value |
Reduced Rate for Certain Non-Filers (Special Category)
📌 If a person is covered under an Income Tax General Order issued under Section 114B, the tax rate is increased significantly.
➡ Applicable Rate:
75% of the bill amount or card value
This applies to persons who are non-compliant with return filing obligations.
Who Is Exempt from This Tax?
Advance tax under Section 236 is not collected from:
✅ Federal or Provincial Government
✅ Foreign diplomats
✅ Diplomatic missions in Pakistan
✅ Persons holding an exemption certificate from the Commissioner
Is Telephone & Internet Tax Adjustable?
🔹 For most individual users, this tax is treated as minimum tax
🔹 Generally non-refundable
🔹 Businesses may claim adjustment subject to tax regime and documentation
📌 Always check your tax credit statement in the FBR portal.
Where Does This Tax Appear?
•On monthly phone or internet bills
• On prepaid recharge receipts
• In your FBR tax credit ledger
Why This Tax Matters in 2026
• It increases daily cost of connectivity
• Heavy impact on digital businesses & freelancers
• Non-filers face extremely high effective taxation
• Filing return helps improve overall tax compliance profile
💡 Smart Tips to Reduce Your Tax Burden
✔ File your income tax return on time
✔ Avoid falling under Section 114B
✔ Businesses should track telecom tax monthly
✔ Use ATL status to avoid other higher withholding taxes
Frequently Asked Questions (FAQs)
❓ Is mobile phone tax refundable?
➡ Usually no, it is treated as minimum tax.
❓ Does ATL status reduce telecom tax?
➡ No, Section 236 applies regardless of ATL status.
❓ Is internet tax charged on corporate connections?
➡ Yes, but companies may adjust it against final liability.
Disclaimer: This article is published for general informational purposes only and does not constitute legal, tax, or financial advice. Tax laws, rates, and interpretations may change. Readers are advised to consult the Federal Board of Revenue (FBR), relevant notifications, or a qualified tax professional for accurate and up-to-date guidance.