The Federal Board of Revenue (FBR) has announced that the declaration of the telecommunication sector as an industrial undertaking will enable telecom companies to adjust withholding tax deducted on import of capital equipment and plant &amp;amp; machinery for their use.
Through an income tax circular issued by the FBR on Thursday, the FBR has clarified the provisions relating to the Telecommunication sector that have been introduced in Finance Act, 2021.
(I) Inclusion of telecommunication sector in the definition of industrial undertaking under clause (29C) of section 2 of the Ordinance. This will enable them to adjust tax deducted under section 148 on the import of capital equipment and plant &amp;amp; machinery for their use.
(II) Reduction of withholding tax rate under section 153(1) (b) on telecommunication services from 8 percent to 3 percent under minimum tax regime.
(III) Reduction of advance tax under section 236 on the internet and mobile phone usage from 12.5 percent to 10 percent for the tax year 2022 and 8 percent onwards.
Source: Pro Pakistani