KARACHI: Pakistan’s tax department said on Thursday it has impounded 210,000 SIM cards from users who have not filed tax returns in a bid to widen income brackets.
Of a population of over 240 million in 2022, only 5.2 million people filed income tax returns.
The Federal Board of Revenue (FBR) passed the ordinance in April and has since ordered telecom authorities to block connections of 210,000 SIM cards, of which 62,000 were later restored, data from the agency showed.
“We have unblocked the SIM cards of those who have paid the tax,” FBR spokesman Bakhtiar Muhammad said.
“Nobody is going to pay their taxes voluntarily. We have to create a way to make sure people can pay their taxes.”
According to the telecommunications authority, Pakistan has more than 192 million mobile phone subscribers and four telecom service providers.
Pakistanis are required to register their SIM cards with their national identity number, which is often used for multiple connections.
“Access to communications services is a fundamental human right and is essential for many other essential services, including access to information, education and emergency services,” an executive at one of the four telecoms companies told AFP on condition of anonymity.
“We are in dialogue with the authorities to encourage them to use technology to increase tax collections, as any sudden measures could disrupt the provision of these essential services.”
A man leaves the Federal Board of Revenue (FBR) office in Islamabad on July 4, 2024. (AFP)
The South Asian country is struggling to increase its disastrously low revenue base but is hampered by its largely undocumented economy.
The government is seeking further loans from the International Monetary Fund (IMF) to balance its budget, but the IMF has urged Islamabad to make greater efforts to mobilise its own resources.
“This is an absurd move – not everyone who has a SIM card earns enough to be a taxpayer,” digital rights activist Fareiha Aziz told AFP.
“People’s lives depend on their cell phones. This is going too far.”
In a letter to the Ministry of Information Technology in June, the four telecom companies warned that new tax measures on mobile phone users who don’t file tax returns were “unrealistic” and “unworkable” and would scare away foreign investment.
Tauseef Gilani, a 66-year-old businessman from Islamabad, said the novel move was going too far.
“Whatever income I earn, it is my responsibility to contribute to society,” Gilani said.
“But blocking SIMs is unjust. It violates freedom of expression and infringes rights.”
