Latest news with #AamirIbrahim
Business Recorder
4 days ago
- Business
- Business Recorder
Pakistan telecom sector seeks sales tax reduction on services
ISLAMABAD: Telecom sector has proposed the government to reduce sales tax on telecom services from the current 19.5 percent - highest compared to other sectors to 16 percent in the upcoming budget 2025-26, besides harmonise across the country whereby all provinces and federal capital should have same rate. IT and Telecom sector submitted the budget proposals to the government which also proposed Advance tax may be reinstated to improve the purchasing power of customers as majority of the customers are below taxable limit. The sector proposed abolishment of advance income tax at 10% under Section 236A of ITO 2001 on auction of new or renewal of Telecom licenses, while justifying that Advance tax on auction of license inflates the cost of doing business and cost of capital for telecom sector, hindering 4G/5G and rural expansion. The proposals maintained that Cellular Mobile Operators are subject to deduction/collection of withholding of income tax on large number of transactions e.g. electricity bills of cell sites which are thousands in numbers as a result this increases the cost and complexity in compliance and an additional administrative burden for the telecom sector. Verification of claim of this tax collection on bills by tax authorities is also not possible and can save authorities from operational burden. Further, withholding tax deducted from telecom services is treated as minimum tax which is against the principle of taxation as this is payable even in loss making years. Further, current recovery measures are very harsh creating business disruptions and shaking taxpayers' confidence. The sector proposed the exemption from deduction/collection of withholding taxes by adding a clause in 2nd Schedule of ITO 2001. In case of acceptance of this, proposals mentioned at point b and c below will be redundant. They further proposed that withholding tax on telecom services at 4% u/s 153 to be adjustable instead of minimum tax. The shift from an adjustable income tax to a minimum tax has effectively reclassified income tax from a direct tax to an indirect tax. This is because the amount of tax payable is no longer tied to the actual income earned, but rather a fixed charge that applies uniformly, irrespective of the company's profitability. The sector proposed for increase carry forward period of minimum tax credit u/s 113 from 3 years to 5 years and bring it back to the position prior to Finance Act 2024. Pay back period of telecom sector is very slow and it takes longer time to recover the return on investment ranging from 8 to 10 years. So limiting the credit to 3 years is not sustainable for loss making companies, they added. The proposal also included removal of the regulatory duty rates on telecom power equipment which are not locally manufactured. Moreover, telecom services sector should be exclude from retail price list because they don't import the goods for direct sale. Aamir Ibrahim, CEO Jazz and Chairman Telecom Operators Association said that over-taxation of telecom not only hurts affordability for consumers, it also weakens investor confidence in a sector that requires constant innovation and infrastructure upgrades. Overburdening telecom sector with excessive taxation is not just economically counterproductive — it's socially regressive. We must recognise telecom as the digital backbone of every other sector and treat it as such in our fiscal policies,' said CEO Jazz while talking to this correspondent. Talking about the role of telecom in the country' digital future he said that connectivity today is as essential as roads and power grids. 'Telecom is the infrastructure that powers e-commerce, mobile banking, online learning, telehealth, and even public service delivery. Yet, we continue to treat it as a revenue stream instead of a strategic enabler. If we are serious about building a future-ready Pakistan, we need to start seeing telecom as a development multiplier, not a luxury,' he added. He further said that Pakistan's tax burden is disproportionately carried by a narrow group of compliant individuals and industries. To build a sustainable digital economy, we need to widen the tax net—bringing more participants into the formal economy — rather than repeatedly taxing those who are already contributing. Placing additional pressure on the formal, documented sectors, especially one as foundational as telecom, only discourages investment, slows innovation, and undermines long-term growth, he added. Ibrahim said that every tax on telecom is effectively a tax on opportunity. Whether it's a student in rural Balochistan attending a virtual class or a woman entrepreneur using mobile payments to grow her home business, digital access is a lifeline. A more forward-looking fiscal policy would reduce barriers to connectivity, making digital inclusion a reality for all Pakistanis. 'Telecom is not a luxury — it is a critical utility, much like electricity or clean water. It enables students to learn, entrepreneurs to sell, farmers to access market information, and patients to receive remote healthcare. Overburdening this sector with excessive taxation is not just economically counterproductive — it's socially regressive. We must recognize telecom as the digital backbone of every other sector and treat it as such in our fiscal policies', CEO Jazz added. Ibrahim further said that over-taxation of telecom not only hurts affordability for consumers, it also weakens investor confidence in a sector that requires constant innovation and infrastructure upgrades. A rationalized tax regime, coupled with efforts to document the informal economy, would yield more sustainable revenues for the state without compromising the growth of the digital ecosystem. Copyright Business Recorder, 2025
Business Recorder
4 days ago
- Business
- Business Recorder
Telecom sector seeks sales tax reduction on services
ISLAMABAD: Telecom sector has proposed the government to reduce sales tax on telecom services from the current 19.5 percent - highest compared to other sectors to 16 percent in the upcoming budget 2025-26, besides harmonise across the country whereby all provinces and federal capital should have same rate. IT and Telecom sector submitted the budget proposals to the government which also proposed Advance tax may be reinstated to improve the purchasing power of customers as majority of the customers are below taxable limit. The sector proposed abolishment of advance income tax at 10% under Section 236A of ITO 2001 on auction of new or renewal of Telecom licenses, while justifying that Advance tax on auction of license inflates the cost of doing business and cost of capital for telecom sector, hindering 4G/5G and rural expansion. The proposals maintained that Cellular Mobile Operators are subject to deduction/collection of withholding of income tax on large number of transactions e.g. electricity bills of cell sites which are thousands in numbers as a result this increases the cost and complexity in compliance and an additional administrative burden for the telecom sector. Verification of claim of this tax collection on bills by tax authorities is also not possible and can save authorities from operational burden. Further, withholding tax deducted from telecom services is treated as minimum tax which is against the principle of taxation as this is payable even in loss making years. Further, current recovery measures are very harsh creating business disruptions and shaking taxpayers' confidence. The sector proposed the exemption from deduction/collection of withholding taxes by adding a clause in 2nd Schedule of ITO 2001. In case of acceptance of this, proposals mentioned at point b and c below will be redundant. They further proposed that withholding tax on telecom services at 4% u/s 153 to be adjustable instead of minimum tax. The shift from an adjustable income tax to a minimum tax has effectively reclassified income tax from a direct tax to an indirect tax. This is because the amount of tax payable is no longer tied to the actual income earned, but rather a fixed charge that applies uniformly, irrespective of the company's profitability. The sector proposed for increase carry forward period of minimum tax credit u/s 113 from 3 years to 5 years and bring it back to the position prior to Finance Act 2024. Pay back period of telecom sector is very slow and it takes longer time to recover the return on investment ranging from 8 to 10 years. So limiting the credit to 3 years is not sustainable for loss making companies, they added. The proposal also included removal of the regulatory duty rates on telecom power equipment which are not locally manufactured. Moreover, telecom services sector should be exclude from retail price list because they don't import the goods for direct sale. Aamir Ibrahim, CEO Jazz and Chairman Telecom Operators Association said that over-taxation of telecom not only hurts affordability for consumers, it also weakens investor confidence in a sector that requires constant innovation and infrastructure upgrades. Overburdening telecom sector with excessive taxation is not just economically counterproductive — it's socially regressive. We must recognise telecom as the digital backbone of every other sector and treat it as such in our fiscal policies,' said CEO Jazz while talking to this correspondent. Talking about the role of telecom in the country' digital future he said that connectivity today is as essential as roads and power grids. 'Telecom is the infrastructure that powers e-commerce, mobile banking, online learning, telehealth, and even public service delivery. Yet, we continue to treat it as a revenue stream instead of a strategic enabler. If we are serious about building a future-ready Pakistan, we need to start seeing telecom as a development multiplier, not a luxury,' he added. He further said that Pakistan's tax burden is disproportionately carried by a narrow group of compliant individuals and industries. To build a sustainable digital economy, we need to widen the tax net—bringing more participants into the formal economy — rather than repeatedly taxing those who are already contributing. Placing additional pressure on the formal, documented sectors, especially one as foundational as telecom, only discourages investment, slows innovation, and undermines long-term growth, he added. Ibrahim said that every tax on telecom is effectively a tax on opportunity. Whether it's a student in rural Balochistan attending a virtual class or a woman entrepreneur using mobile payments to grow her home business, digital access is a lifeline. A more forward-looking fiscal policy would reduce barriers to connectivity, making digital inclusion a reality for all Pakistanis. 'Telecom is not a luxury — it is a critical utility, much like electricity or clean water. It enables students to learn, entrepreneurs to sell, farmers to access market information, and patients to receive remote healthcare. Overburdening this sector with excessive taxation is not just economically counterproductive — it's socially regressive. We must recognize telecom as the digital backbone of every other sector and treat it as such in our fiscal policies', CEO Jazz added. Ibrahim further said that over-taxation of telecom not only hurts affordability for consumers, it also weakens investor confidence in a sector that requires constant innovation and infrastructure upgrades. A rationalized tax regime, coupled with efforts to document the informal economy, would yield more sustainable revenues for the state without compromising the growth of the digital ecosystem. Copyright Business Recorder, 2025
Business Recorder
24-05-2025
- Business
- Business Recorder
Strategic partnership with ‘Engro Corp': Jazz secures all regulatory approvals
ISLAMABAD: Jazz has announced that it has secured all regulatory approvals for its strategic partnership with Engro Corporation Limited ('Engro Corp') for the pooling and management of telecommunications infrastructure assets in Pakistan. The partnership, initially announced on December 5, 2024, is expected to enhance the efficiency of infrastructure and digital investments in the country, in line with Pakistan's digital ambitions. Under the agreement, Jazz's infrastructure assets, managed through its wholly owned subsidiary Deodar (Private) Limited ("Deodar"), will vest into Engro Connect through a court-sanctioned scheme of arrangement. Regulatory approvals have been obtained from the Competition Commission of Pakistan (CCP), the Pakistan Telecommunication Authority (PTA), and the Islamabad High Court. Completion of the transaction is expected in June 2025. Aamir Ibrahim, CEO of Jazz, commented: "I am pleased to note that we are now progressing to closing our pioneering infrastructure partnership with Engro Corp. This marks a significant milestone in our Service Co transformation. We will continue delivering world-class digital solutions empowering millions of Pakistanis in an asset-light model, while collaborating with Engro Corp, a trusted leader, for the infrastructure layer.' Abdul Samad Dawood, CEO of Engro Holdings, added: "Prosperity and progress increasingly rely on technology and connectivity – and with this milestone, Engro strengthens its role as an enabler of Pakistan's progress. This investment reinforces telecom infrastructure as a key vertical for us and we are keen on expanding access, empowering communities, and future-proofing the infrastructure that will drive growth for generations to come. This is a special moment for all of us at Engro, as this is what we have always stood for: Enabling Growth." As this strategic partnership nears completion, Jazz will continue to lease Deodar's infrastructure under a long-term agreement, ensuring uninterrupted nationwide connectivity and service for its users. This milestone enables Jazz to fully focus on its ServiceCo vision—scaling digital platforms like JazzCash, Tamasha, SIMOSA, FikrFree, Garaj, and GameNow that serve over 100 million Pakistanis. Copyright Business Recorder, 2025
Business Recorder
15-05-2025
- Business
- Business Recorder
Jazz posts 20.3pc revenue growth YoY in Q1
ISLAMABAD: Jazz, country's leading digital operator and a part of the VEON Group, reported a 20.3 per cent year-on-year revenue growth in Q1 2025, driven by continued digital diversification and disciplined cost management. During the quarter, Jazz invested Rs9.5 billion—marking a 78.4 percent year-on-year increase—to expand 4G capacity and scale its digital platforms. This performance was delivered despite persistent macroeconomic and policy headwinds impacting the telecom sector. Direct digital revenues grew 49.5 per cent YoY, contributing 27.7 per cent to total revenue, driven by strong fintech and digital services performance and Jazz's strategic shift to platform-based models. With over 20.6 million monthly active users, Pakistan's leading fintech JazzCash processed a gross transaction value of Rs 10.7 trillion during the last twelve months as of March 2025. Its extensive network, comprising 121,000 active agents and over 340,000 active merchants, has facilitated considerable digitalization of society, with approximately 142,000 digital loans issued daily. Mobilink Bank also delivered a strong performance, recording 25.5 per cent revenue growth. Among digital verticals, Tamasha—Pakistan's largest home-grown streaming platform—grew 37.6 per cent year-on-year to 16.5 million MAUs, driven by exclusive cricket content, including over 57 live match days across the ICC Champions Trophy, PSL, and major bilateral series. SIMOSA, Jazz's Sim-Care, Lifestyle & Social app, grew to 20.9 million MAUs, with its new social community attracting 1 million users within 23 days of launch in Q1 2025. FikrFree, Jazz's AI-powered insurance and healthcare marketplace, has surpassed 1 million MAUs and 1.8 million policies sold since its October 2024 launch, with new features underway to expand access to quality healthcare nationwide. ROX—Jazz's youth-centric digital lifestyle platform—also grew to 700,000 monthly active users. The company's mobile customer base reached 73.4 million, with 4G users increasing 16 per cent year-on-year to 53.3 million. Mobile ARPU rose 14.0 per cent to PKR 328, supported by higher data usage and uptake of digital bundles. Multiplay customers—who use more than one Jazz service—grew 33.1 per cent and now account for 37 per cent of the user base. EBITDA grew 13.2 per cent year-on-year, while EBITDA margins slightly declined to 42 per cent, reflecting a shifting revenue mix. As Jazz scales new digital platforms, which have comparatively lower margins than traditional telecom services, investments in innovation and service diversification are expected to drive long-term growth. Aamir Ibrahim, CEO of Jazz, said: 'This growth reflects our successful transformation into a ServiceCo—powered by innovation, financial discipline, and a deep commitment to digital inclusion. We're building platforms that empower individuals, enable small businesses, and help create a more connected, resilient Pakistan. To sustain this momentum, we urgently need tax and policy reforms that recognise the strategic value of digital infrastructure and foster long-term investment.' As Pakistan's top taxpayer, Jazz has contributed over Rs502 billion to the national exchequer in the past decade. Copyright Business Recorder, 2025
Express Tribune
30-04-2025
- Business
- Express Tribune
High spectrum costs hamper digital access
Listen to article The telecom industry has urged the government to address challenges of high spectrum prices, scarce availability, digital literacy gaps, and limited broadband access to help move the country toward a Digital Pakistan. "Structural challengessuch as overpriced and scarce spectrum, digital literacy gaps, and limited broadband accessmust be urgently addressed," said Jazz CEO Aamir Ibrahim at the Pakistan Digital Foreign Direct Investment (DFDI) Forum 2025. While speaking during a panel discussion titled "DFDI Landscape: Insights and Actions," he emphasised that challenges such as broadband expansion, digital banking, and digital education cannot be addressed by the private sector or NGOs alone. "The government must play an enabling rolesometimes by intervening, and at other times by stepping back," he said. On spectrum pricing, he was unequivocal, "Spectrum is the foundation of broadband connectivity, yet it has historically been mispriced. The upcoming auction offers an opportunity to fix this and enable digital growth," he remarked. If Pakistan is to lead in the digital era, it must shift from a whole-of-government to a whole-of-country approachmobilising every sector, stakeholder, and citizen around a shared digital vision," he said and stressed that digital investment is not merely about capital, it is also about building confidence in Pakistan's talent and potential. "We're already a generation behind in tech. Without embracing Artificial Intelligence (AI), local large language models, data centres, and fast internet, we risk falling two generations behind," he cautioned. The panel featured key voices from across sectors, including United Nations Development Programme's (UNDP) Samuel Rizk, Contour Software's Bilal Mahmood, Milliman's Dermot Corry, AI Doctrine Inc's Naeem Mirza, and the Digital Cooperation Organisation's Rao Mehroz Khan. In a separate session titled "Opportunities for the Telecom Sector in the Digital Era," Asif Aziz, President Enterprise Solutions at Jazz, called for a strategic shift in the telecom sectorfrom providing basic connectivity to enabling full-scale digital ecosystems for enterprises. "Pakistan has 197 million mobile connections, but now it's about enabling digital transformation across healthcare, logistics, manufacturing, and agriculture," he said. He also flagged the risks of prohibitive spectrum pricing: "If it discourages investment in infrastructure, 5G will remain a theoretical promise." On affordability, Asif highlighted a critical gap, stating, "While 40% of the population lives within mobile broadband coverage, many still don't use it. A basic smartphone costs 3740% of a low-income household's monthly income, and import duties exacerbate this issue. Connectivity without affordability is connectivity in name only." Across the forum, panellists emphasised that bold public-private collaboration, regulatory reforms, and alignment with global best practices are essential. With a young population and rising demand for innovation, Pakistan is well-positioned to unlock inclusive digital growthif the right actions are taken now.
