Telecom operators are obstructing the process of disabling mobile phone SIM cards for over half a million non-filers in Pakistan, and the federal government is planning to take legal action against them, a report said on Saturday.

This decision to act against telcos and others was made during a visit by Federal Finance Minister Muhammad Aurangzeb to the Federal Board of Revenue (FBR) headquarters, where Attorney General for Pakistan Mansoor Usman Awan was also present, Express Tribune reported.

The FBR informed the finance minister about its plan to disable SIM cards belonging to 506,671 individuals who are not on the active taxpayer list but are required to file their income tax returns for 2023. The meeting also addressed the issue of non-cooperation by the Pakistan Telecommunication Authority (PTA) due to pressure from telecom operators in implementing this decision, the report said.

It was decided that the government would take action against anyone who attempts to hinder the inclusion of these non-filers into the tax net. The finance minister emphasized that the decision to block SIM cards of non-filers had the support of the army chief, and there should be no opposition to this move.

The PTA, in a news statement, stressed the importance of maintaining a balance between the FBR’s objective of disabling SIM cards and protecting the investments of telecom operators. The statement emphasized the PTA’s commitment to regulatory compliance and safeguarding the interests of telecom consumers.

While over half a million SIM cards will be disabled, there will be no restrictions on individuals to acquire new SIM cards. The FBR is also developing a mechanism to unblock the SIM cards of those individuals who file their tax returns.

It should be noted that the FBR had issued notices to 2.4 million people, but in the first phase, action is to be taken against 506,000 individuals. Each person may have multiple SIM cards, and all connections will be terminated immediately.

The finance minister was also informed about the lack of progress in bringing retailers into the tax net. The FBR’s voluntary registration campaign for retailers has seen limited success, with only 75 retailers availing themselves of the scheme. Consequently, the minister instructed the FBR to initiate compulsory registration for retailers.

The voluntary registration scheme was launched by the government to bring approximately 3.2 million retailers into the tax net. However, only a small number of retailers have registered themselves with the FBR. The FBR stated that legal action would be taken against retailers who remained outside the tax net.

During the meeting, the issue of the disputed tax revenue amounting to Rs2.7 trillion was also discussed. It was agreed that the higher courts would prioritize cases where the FBR had achieved success at the commissioner appeals and appellate tribunal stages. The government has abolished the first tier of commissioner appeals to expedite the recovery of disputed revenues.

The meeting concluded with the decision to devise a comprehensive strategy to actively pursue all pending legal cases for the early recovery of stuck-up revenue. Additionally, the fees of FBR lawyers will be increased for cases in high courts and the Supreme Court.