Import of mobile phones: Government likely to revise downward tax slabs

The government is likely to downward revise tax slabs on the import of mobile phones and reduce customs duty on completely knocked down (CKD)/semi-knocked-down (SKD) kits of mobile phones to encourage local manufacturing of mobile handsets in Pakistan. It is learnt that the Federal Board of Revenue (FBR) is reviewing budget proposals of the Pakistan Telecommuni-cation Authority (PTA) for massive reduction in duties and taxes on the import of various types of mobile phones under new tax slabs structure for 2020-2021.

According to the budget proposals (2020-2021) of the PTA communicated to the Ministry of Finance, the PTA has proposed changes in the tax slabs for commercial and local assembly of mobile phones.

The PTA has proposed reduction in duties and taxes on the import of almost all tax slabs ranging on the import of mobile sets up to US$30 to above US$500.

The PTA stated that the feature/basic mobile phones are not only available in abundance but also affordable by all segments of the society and even the poorest.

However, for smart mobile phones, Pakistan is dependent on imported phones.

These smart phones are not only used for communications but it is used as a tool in every segment of the economy including business, education, health, agriculture, and social development etc.

The PTA believes that in the digital ecosystem availability and affordability of these phones will play a major role in the growth of economy.

The PTA has proposed to the Ministry of Finance that all imported mobile phones including smart phones are heavily taxed, which has become major impediment in proliferation of broadband in the country.

The PTA, therefore, proposed this tax may be brought down to a reasonable level in each slab.

Moreover, it is recommended that customs duty on the SKD and the CKD should be abolished or brought down to encourage local manufacturing of mobile handsets in Pakistan, the PTA budget proposals added.