Punjab Revenue Authority (PRA) has just sent official tax notices to Facebook and Google operating in Pakistan. PRA is asking the tech companies to start paying taxes for the advertisement services they are providing inside Pakistan.
On 16 January 2013, an ordinance was issued by the government that makes tax payments valid on online advertising. These services were to be charged 16% for every company offering the service, including tech giants like Google and Facebook.
The written tax notices have been sent to Mark Zuckerberg in the USA and Google regional office in Lahore.
Additionally, PRA said that all companies who are offering such services in Pakistan are bound to pay the tax to the local government. This is common practice throughout the world and should not be ignored in Pakistan. Even the two tech giants in question pay their taxes in their home country and as well as in other countries where they operate.
Google and Facebook are yet to register with the Pakistani Tax authorities. The written notices has also asked the two companies to immediately register themselves with the local tax authority. They have a maximum of 7 days to register and pay all applicable taxes to the government.
This move definitely shows that the government is set to take online company taxes seriously from now on. Several other local companies also have had it easy so far.