Facing widespread protests, the National Board of Revenue (NBR) has decided to reduce the supplementary duty on mobile phone calls, internet usage, and other ICT services from 23% to the previous rate of 20%. Additionally, the NBR has resolved to withdraw the 10% supplementary duty imposed on internet service providers (ISPs). The supplementary duty on ISP services was introduced on January 9 this year. Similarly, the NBR had raised the supplementary duty on telecommunication services, including mobile phone usage and internet, from 20% to 23%, which will now be reverted to the original 20%.
NBR’s Second Secretary, Badruzzaman Munshi, stated, “The SRO will be issued by Sunday.” He also mentioned that discussions are ongoing regarding a few other important sectors, but no final decisions have been made yet.
Regarding other sectors, Munshi explained that the VAT on restaurant services, which had been increased to 15% under the VAT and Supplementary Duty Ordinance, has been revised down to 5%. He confirmed that the NBR is now implementing this revised decision.
Sources indicate that VAT rates for several sectors, including garments and non-AC hotels, have been reduced to 10%. Previously, these sectors were subject to a 15% VAT. The reduced VAT rates will soon be finalized through official notifications within a few days.
The NBR’s decision comes after severe criticism of its January 9 ordinance, which had increased VAT and duties on over a hundred goods and services. During a time of high inflation, the interim government’s move to impose such significant tax hikes drew extensive public backlash.
