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High court suspends tax on incoming international calls
 
October 26, 2012
 
 

LAHORE - Giving relief to thousands of expatriates on Eidul Azha, the Lahore High Court (LHC) Thursday suspended an additional tax on incoming international calls. Barring the authorities from receiving the tax, the LHC observed the government had been coming up with new taxes but the judiciary would prevent injustice to the masses. More than 6.5 million overseas Pakistanis have been protesting against the new tax that has been dubbed as an attempt to ‘benefit’ a cartel of 14 long distance international (LDI) operators. A Lahore-based local loop operator (LLO), Brain Telecommunication Limited, challenged the additional tax.Barrister Umar, counsel for the LLO, told the court that with the approval of Prime Minister Raja Pervaiz Ashraf, the Information Technology Ministry had issued a policy directive, asking the Pakistan Telecommunication Authority (PTA) to immediately execute an agreement, International Clearing House (ICH), with 14 LDIs. The PTA acted upon the instructions and established ICH for LDI operators with effect from October 1, the court heard.By revising the international call termination charges, the expatriates have been facing a fourfold increase in call rates into their homeland as foreign telecom operators had hiked the rates, Barrister Umer said, adding the approved settlement rate (ASR) for international incoming calls was also notified by the PTA.According to the agreement of ICH - a single technical exchange or gateway - the PTA was fixing the prices of per minute incoming calls from different foreign countries, while quota was also being distributed among the cartel of 14 LDIs, the court heard. “The Competition Commission of Pakistan (CCP) had also issued a dissent note to the ministry and the PTA to withdraw its decision to establish an international clearing house exchange. The decision was also not tenable in terms of Competition Act 2010,” Umar said and requested the court to annul the tax. A federal government’s lawyer told the court the tax had been imposed to generate revenue and it was the prerogative right of the government. After hearing arguments from the two sides, Justice Ijazul Ahsan barred the government from charging the additional tax and sought detailed report from the IT Ministry, PTA, CCP and PTCL. The court will resume hearing on November 5. 

 
 
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