(Pakistan Point News – 29th July, 2016) : Punjab Revenue Authority (PRA) has been making efforts trying to convince the internet conglomerates to pay tax; had formerly issued a notice for getting them registered in Lahore and pay taxes for the revenues they got from Punjab. Unexpectedly Facebook replied to the PRA via a letter which said, “Registration with the PRA is not applicable to us as we aren’t taxable in the country. We are providing our online services from Ireland from where the multinational corporation is operating”.
According to PRA act, Pakistani advertisers that advertise through Facebook are legally responsible to sales tax. According to a section of PRA Act, “Where a taxable service originates from outside Pakistan but is received or terminates in the Punjab, the recipient of such service shall be liable to pay the tax to the government”. PRA is fundamentally trying to implement tax on Pakistanis advertisers who advertise on Facebook, conversely, they can’t know the advertisers without Facebook’s help.
Facebook is not ready to help PRA because it doesn’t want to increase the cost of advertising on its website by revealing advertisers’ list, it will decrease the ratio of advertisements on Facebook. Punjab Revenue Authority is going to implement ‘Compulsory Registration’ of such companies including Facebook, Google, DailyMotion etc, after which permissible actions will be taken against these companies. PRA can approach Pakistan Telecommunication Authority and can block these websites in Pakistan for not paying taxes. PRA stated that legal wing of PRA is taking all possible otions into account to get these websites with-in the tax net.