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To increase tax revenue and reduce the budget deficit, the federal government plans to impose a new tax on mobile phone sets in the upcoming budget, which may lead to a sharp increase in cell phone prices.
According to reliable sources, the federal government is considering imposing an 18 percent sales tax on mobile phone assembling units in the next budget.
Meanwhile, the Pakistan Mobile Phone Manufacturers Association (PMPMA) has urged the Federal Board of Revenue (FBR) to uphold the government’s commitments to investors and avoid raising tariff structures for mobile phones.
During a recent meeting with the FBR, the PMPMA delegation expressed concerns that raising tariffs would not only disrupt the localization schedule but also adversely affect Pakistan’s mobile phone export targets.
The delegation emphasized that imposing an 18 percent sales tax on all mobile phones assembled in the country would severely impact the industry. Under the Mobile Device Manufacturing Policy 2020, phones priced up to $350 are exempt from the 18 percent sales tax, while those above this price range are subject to the full tax.
The Association highlighted that most local companies assemble phone sets within this price range, which constitutes approximately 55 percent of smartphones used in the country.
