Importing a mobile phone has become 86% cheaper as the FBR slashes import duties. But it’s only for phones that cost $100 or less.
The sales tax on importing mobile phones that cost up to $100 has been reduced from Rs1,320 to Rs200. The FBR is amending its tax laws with effect from December 28, 2019.
Mobile phones worth less than $100 will be charged withholding tax of Rs200. People buying phones in this slab were previously paying Rs750 in duties.
The import volume of mobile phones halfway through the 2019-20 financial year (July to November 2019) was recorded at $391 million while last year’s imports for the same time period were $248 million. This means imports increased by 58%.
Heavier duties were imposed last May to increase the volume of tax collected on luxury imports.
However the Senate Standing Committee on Information Technology advised the FBR to slash duties as they did not mesh well with the vision of digitising Pakistan.
In September, the FBR had proposed cuts in the Customs regulatory duties of mobile phone imports in order to encourage digitisation and the “provision of relief to the common man”.
“This reduction in duty/tax is expected to increase import volume of mobiles in Pakistan,” read a notfication by the FBR.
In a move to digitize Pakistan, the ministry of commerce and the ministry of IT have collectively worked out a proposal for revised sales tax rates and regulatory duties on the import of mobile devices, an FBR official told SAMAA Digital.