Karachi, July 20, 2024 – The Sindh Revenue Board (SRB) has announced the sales tax rates on telecom services for the tax year 2024-25, maintaining a consistent rate across various services.
The statutory rates for telecom services, as outlined by the SRB for the upcoming fiscal year, stand at 19.5% for a comprehensive range of services.
The SRB’s decision to set a uniform tax rate of 19.5% on all telecom services is in line with the rates from the previous fiscal year, ensuring stability and predictability for businesses and consumers alike. This rate applies to several key telecom services, including telecommunication, telephone, and internet services, among others.
Telecommunication and Telephone Services
The SRB said telecommunication services, which encompass various forms of telephone services such as fixed line voice, wireless, cellular, and video telephone services, are all subject to the 19.5% sales tax. This also includes specific services like wireless local loop telephone services, payphone cards, and prepaid calling cards. Essential services like voice mail, messaging services (including SMS and MMS), and shifting or changing of telephone connections also fall under this tax rate, according to the SRB.
Bandwidth and Internet Services
Bandwidth services, which are critical for data transmission and connectivity, are uniformly taxed at 19.5%. This includes copper line-based, fiber-optic based, co-axial cable-based, microwave-based, and satellite-based services. Internet services, which are pivotal for both personal and business communications, including email, dial-up, and broadband services (DSL, fiber-optic, co-axial cable, wireless, and satellite-based), are also subject to the 19.5% tax.
The SRB has ensured that all forms of internet and data services on WLL and cellular mobile networks are taxed at the same rate. This uniform taxation also extends to data communication network services (DCNS), covering various mediums such as copper lines, co-axial cables, fiber-optic, wireless, radio, and satellite-based services.
Value-Added Services and Others
Value-added data services, including virtual private network (VPN) services and digital signature services, are taxed at 19.5%. Other specified telecommunication services, such as audio text, teletext, trunk radio, and paging services, also fall under the same tax bracket. Additionally, tracking and alarm services, including vehicle tracking, burglar, and security alarm services, are included.
The SRB’s consistent tax rate of 19.5% across these varied services ensures a streamlined and straightforward tax structure, which can aid in compliance and administration. For consumers and businesses utilizing these services, the clarity in taxation can help in budgeting and financial planning for the coming fiscal year.
This comprehensive taxation approach by the SRB reflects an effort to maintain a balanced fiscal policy while ensuring that essential telecommunication services remain accessible and affordable. As the tax year 2024-25 unfolds, the uniform tax rate will play a significant role in the economic dynamics of the telecom sector in Sindh.