Fearing a new wave of inflation and decline in government's revenue from telecom sector, a parliamentary panel on Tuesday recommended for rationalisation of duty structure on mobile phone imports and further extension in deadline for blocking unregistered mobile phones.
"With the implementation of Device Identification Registration Blocking System (DIRBS), a new wave of inflation is going to hit the country as the price of mobile phone currently available at Rs 2,000 will reach Rs 8,000, which would directly hit the poor segment of the society," observed the senators from the government as well as opposition with one voice.
The concerns were shown during the meeting of Senate Standing Committee on Information Technology and Telecommunication which met here with Senator Rubina Khalid in the chair on Tuesday. The deadline for registering mobile devices under PTA's DIRBS expires on midnight January 15, 2019.
According to the PTA documents, mobile devices which are not activated by January 15, 2019 will be provided an option to get such devices regularised on payment of leviable duty/taxes along with payment of equivalent to 10 percent of the amount of duty/taxes involved thereon on furnishing of certificate of compliances issued by the PTA.
The representatives of Ministry of IT and PTA and member customs briefed the parliamentary panel regarding streamlining the process for collection of customs duty on cell phones on arrival at all airports and extension in time period to block unregistered IMEI cellphones as directed by the committee in its last meeting.
The body expressed serious concern over huge duties on mobile import/personal use and recommended for uniform duty structure to bring mobile phone prices at par with the other countries. The parliamentarians further stated that with increase in duty rate, it is expected that the government business/revenue may further decline in coming days.
Senator Fida Muhammad asked the panel regarding revenue generated by this measure. The committee was informed that since 40% mobile phones enter the country through grey channels, this measure will generate huge revenue for the country. The committee was also informed that taxes would be charged in three slabs (less than US $60, more than $60 and $130 and more).
Objecting to the measure, Senator Taj Muhammad Afridi was of the view that international duty structure must be followed. He recommended that the finance minister should be present in the next meeting. Senator Faisal Javed was of the view that imposing high taxes on cell phones being brought in Pakistan from abroad is pointless unless Pakistan establishes its own local industry.
Senator Mian Muhammad Ateeq Shaikh recommended that it is imperative that cell phones being brought for commercial use be separated from those being brought for personal use to protect the common man from being fleeced.
Briefing the committee, officials from the PTA admitted that their system for online mobile registration for overseas Pakistanis is yet to be completed and people have to still wait in queues at airports till the launch of web-based online registration system in place. However, they said that the system is likely to be launched by January 25.
The committee expressed annoyance that the system has not been put in place while the PTA is going for DIRBS implementation. First launch the system and check its results after which the policy would be implemented, the senators added. The committee recommended for further extension till the online system is fully operational.
Federal Minister for IT&T Khalid Maqbool Siddiqui assured the committee that the matter would be reconsidered. Officials from Federal Board of Revenue (FBR) informed the committee that the Cabinet Division would be required to move a summary to the federal cabinet while seeking further extension in the deadline.
As per the policy, mobile phone would not be blocked automatically for 30 days and one has to register it with PTA during this period after paying duty/taxes (in case more than one phone); however, the committee recommended that this period is very short while keeping in view the extremely poor awareness campaign by PTA it should be extended to 60 days.
The officials' viewpoint was seconded by the committee that DIRBS system is good for controlling smuggled phones, increasing revenue as well as controlling terrorism. The PTA officials informed that in line with the federal cabinet's decision, DIRBS was implemented where all mobile devices already active on networks within Pakistan as of 1st December 2018 were made compliant and shall remain operational without disruption of services.
Furthermore, all non-compliant mobile devices as of 1st December, 2018 were tied / paired to those number and shall remain operational till useful life of devices. The member customs informed the committee that prior to the launch on 01-12-2018, FBR had notified procedure for registration of mobile devices brought by international passengers in their luggage.
Under the said procedure, the international passengers are provided option to get their mobile phones registered either at Customs Kiosks available at the international airports or at the nearest customs office in the city. More than 37,000 devices have been registered till date.
However, in order to further facilitate the international passengers, the FRB and PTA in coordination with cellular mobile operators are exploring technological solutions whereby passengers are not required to interface with customs at any stage for registration/ regularisation of mobile phones imported in accompanied luggage.
The tentative features of this solution are; (i) registration through the CMOS -franchise outlets, (ii) registration device through web and, (iii) registration of devices through USSD code. The payment of duty/taxes can be made through all major banks, online banking, CMOs franchise and mobile wallets. The facility is likely to be operational in the last week of January 2019.
The committee raised questions over an agreement reportedly signed with an American company for monitoring international traffic, while saying whether national cyber has been protected or not. The committee sought details of the agreement in the next meeting.
While deliberating upon the matter of paying increase in pensions to the PTCL pensioners by Pakistan Telecommunications Employees Trust, Senator Ghous Muhammad Khan Niazi was of the view that payment in instalments seems feasible, since paying off all liabilities in full would be impossible.
The committee chairperson showed dismay over delay in payments and said that the country is indebted to these people for dedicating their lives to the service of the people of Pakistan. She said that it is a shame that at this critical stage in their lives when it is time for them to rest, they are forced to incessantly pursue what is rightfully theirs.
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