Government Collected 25% More Through Telecom Sector For 2015-16: PTA

(Islamabad, October 28, 2016) :- According to the Annual Report for the year 2015-16 issued by Pakistan Telecommunication Authority (PTA), The contribution of telecom sector to national treasury has increased from Rs. 126.3 billion (during FY 2014-15) to Rs. 157.8 billion in fiscal year 2015-16. As per report, unusual collection during FY 2013-14 was mainly due to PTA’s deposits as a result of 3G and 4G spectrum auction. Moreover, while comparing the growth in telecom revenue vs. telecom contribution to National Exchequer over the last fiscal year, it becomes clear that the Government’s collections have actually increased by 25% whereas telecom revenues have increased by only 1.47% during the fiscal year 2015-16.

Report Further disclose that in the mentioned period, telecom sector continued to grow positively in terms of subscription, revenues and tele density.  Broadband penetration has increased to 18.3% from just 2% in the year 2014. ICT solutions, being offered on mobile broadband, are making a big difference in every walk of life. Hundreds of billions of rupees are being sent and received over the mobile money channels by the people of Pakistan. In FY 2015-16, the amount transacted through the Mobile Banking was Rs. 1,492 billion.

Report indicates the positive move that innovative and cost-effective solutions are being offered in the e-commerce, online education, e-health, travel and governance sectors. Due to such high demand for mobile broadband services, Telenor Pakistan also attained 4G spectrum for US $395 million during 2015-16. Furthermore, the Government collections will also increase from the other sectors of the economy due to broadband and ICT explosion.

 As per press release by PTA, one component of the overall Government collections i.e. GST was decreased but there could be a number of factors behind this decline. For example, the Federal Government and the Government of Punjab have exempted GST on internet/data services whereas the Government of Sindh is charging reduced rate on internet/data services. Resultantly, the share of tax-exempted data revenue in the total telecom revenues increased to 29% in 2015-16 as compared to 19.3% in FY 2013-14. However, the trade-off between GST collection and internet/broadband development turned out to be a wise decision by the Federal, Punjab and Sindh governments.


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