Telecoms protest SIMs blocking

Write letter to MoITT, PTA expressing legal concerns over income tax general order

ISLAMABAD:

Cellular mobile operators (CMOs) are mandated to provide uninterrupted services to their customers, except in circumstances specified in the Telecom Act and relevant regulations. However, there are no instances where CMOs can disconnect or block service to any customer. This was the essence of a letter penned by the telecom industry to the Ministry of IT & Telecom and the Pakistan Telecommunication Authority (PTA).

While the intention of the Income Tax General Order (ITGO) may be to penalise non-compliant individuals or to encourage them to enter the tax net, the specific measure being adopted lacks proper consideration. Neither a legal analysis, guaranteed constitutional rights, nor a cost-benefit review has been conducted by the Federal Board of Revenue (FBR) prior to passing and implementing the ITGO. Rushing through this ITGO will adversely affect customers, impacting their ability to access essential services, now recognised as a right to life under various judgments of superior courts. It also undermines the rights and operational capacity of telecom operators who are fully compliant with tax obligations. Any delinquent individuals should instead be directly sanctioned without implicating and adversely affecting the telecom industry.

The letter further contends that if telecom operators comply with the ITGO, affected individuals may litigate against the CMOs, alleging hasty, illegal, and unlawful SIM card blocking without due process, contrary to law. It is unjust and unacceptable for CMOs to face such risks, considering their significant contribution to revenue collection. Before implementing such orders, protections or indemnities must be extended to CMOs through legal amendments to shield them from adverse consequences or customer actions/claims.

Moreover, the telecom industry believes that bulk blocking of SIMs would pose technical challenges, requiring multiple warnings to customers before execution, as per contractual obligations to provide advance statutory notice with valid reasons. Immediate compliance with the ITGO is difficult as CMOs need reasonable time and resources to develop internal processes and systems to meet such requirements. Additionally, there is no finalised mechanism by PTA or FBR regarding unblocking SIMs after customers file tax returns following service suspension. Therefore, procedural elements related to blocking and restoration of mobile SIMs need thorough deliberation and agreement before action.

In terms of consumer protection and constitutional provisions of basic human rights, Consumer Protection Regulations mandate operators to give prior notice of service suspension. However, in this case, issuing notice is not feasible due to legal defects of the ITGO.

The industry suggests that every individual is entitled to fair and equitable treatment with due process in accordance with the law. Therefore, individuals affected by the ITGO should be duly informed through an extensive media campaign and provided with show-cause notices, allowing them to present their case in a tribunal or court of law. By adhering to this legal and procedural framework, tax compliance measures can be enforced transparently and equitably, reducing the likelihood of legal disputes against telecom operators regarding service blocking or restoration. Moreover, such measures may also encourage non-compliant individuals to file their tax returns without risking significant loss to the FBR through direct SIM blockages under the ITGO.

Published in The Express Tribune, May 7^th, 2024.

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