By Staff Reporter
ISLAMABAD: The Cellular Mobile Operators (CMOs) have collectively denounced the Federal Board of Revenue’s (FBR) directive to block over half a million SIM cards, labeling the move as a breach of the Pakistan Telecommunication (Re-Organization) Act 1996 and an illegal action.
In a unified communication addressed to the Ministry of Information Technology, Pakistan Telecommunication Authority (PTA), and other concerned parties, the CMOs asserted that the FBR’s Section 114B of the Income Tax Ordinance and the Income Tax General Order (ITGO) exceed legal boundaries and contravene the nation’s constitution and telecom laws.
“We would like to seek the support of the regulator PTA, which is entrusted by the legislatures to promote and protect the interests of the users as well as the CMOs,” the letter reads.
“Whilst the intention of the ITGO may be to penalize non-compliant individuals or to coerce or encourage them to come within the tax net, the specific measure being adopted has not been properly thought through; neither a legal analysis, nor guaranteed constitutional rights, nor a cost-benefit review has been undertaken by FBR prior to passing and implementing ITGO.”
The telcos said the ITGO, being forced through with undue haste, will adversely impact the customers. “This will gravely impact the customers’ ability to get essential services, which have now been defined as a right to life under different judgments of superior courts. It is also detrimental to telecom operators’ rights and their ability to operate, as they are fully compliant with their respective tax obligations. Any delinquent individuals should rather be sanctioned/penalized in a direct manner without involving and adversely impacting the telecom industry.”
The letter states that the affected individuals may initiate litigation against the CMOs if telecom operators comply with the ITGO. “If the affected individual is of the view that their SIM card has been blocked in haste, illegally, without due process, and the actions of the telecom operators and FBR are not in accordance with the law.”
“The affected individual may even seek to recover special costs, damages, and losses that he/she has incurred because of their SIM card being blocked. With respect, it is unjust, unreasonable, and unacceptable for CMOs to be exposed to such a risk. On the contrary, CMOs are some of the biggest contributors to the revenue collection in the country. Therefore, before implementing such orders, certain protections or indemnities must be given to CMOs through an amendment in law to save them from adverse consequences or actions/claims from customers.”
The telecom industry also believes that the bulk blocking of these SIMs would be an issue technically and CMOs would need to warn such customers multiple times before the execution of any blocking through SMS messages, if required by law, as they have contractual obligations towards their consumers to provide advance statutory notice with valid reasons, which in this case are absent.
They have to develop internal processes and system development to cater to such requirements, which requires reasonable time and resources; hence, immediate compliance with such ITGO is difficult. Even if such blocking is executed, CMOs are not aware of any mechanism finalized by PTA or FBR regarding the unblocking of the mobile numbers/SIMs after the said customer has filed his/her tax returns consequent to suspension of services. Therefore, many such procedural elements relating to blocking and restoration of Mobile SIMs need to be deliberated and agreed upon before taking such actions.
They said every individual is entitled to fair and equitable treatment with due process in accordance with the law. Therefore, individuals affected by the ITGO should be duly informed through an extensive media campaign and provided with show cause notices, affording them the opportunity to present their case in a tribunal or court of law.
By adhering to this legal and procedural framework, the enforcement of tax compliance measures can be conducted in a transparent and equitable manner, thereby reducing the likelihood of legal disputes against telecom operators regarding the blocking or restoration of services. Moreover, such measures may also encourage noncompliant individuals to file their tax returns without risking significant loss to the FBR through direct SIM blockages under the ITGO, the letter concluded.
Copyright © 2021 Independent Pakistan | All rights reserved
