The National Assembly’s Standing Committee on Finance has raised concerns over heavy taxes on mobile phones and recommended relief for consumers.
The move comes as policymakers push to promote technology and improve economic growth.
A committee meeting, chaired by Naveed Qamar, reviewed the collection of duties and taxes on mobile phones. Officials from the Federal Board of Revenue (FBR), including Chairman Rashid Mahmood Langrial, briefed the committee on the current taxation structure.
During the briefing, it was revealed that a withholding tax of Rs76,000 is imposed on mobile phones costing more than $500.
FBR officials said that the total tax rate on such imported phones stands at 54%. For devices priced between $700 and $750, the tax rate increases further to 55%.
Additional taxes and policies
Officials from the Tax Policy Office informed the committee that an 18% General Sales Tax (GST) is also imposed on mobile phones. They added that concessional income tax is applied, while withholding tax on expensive phones can reach Rs11,500 in certain cases.
Currently, authorities said there is no immediate scope to reduce the 18% GST or withholding tax.
The committee was told that imported phones face significantly higher taxation, with duties reaching up to 54% of the device’s price. In contrast, locally manufactured phones benefit from reduced taxation, with rates lowered to around 25%.
Committee recommends tax reduction
The committee recommended reducing taxes on mobile phones to make technology more accessible to the public.
Naveed Qamar emphasized that improving tax policy is essential to promote modern technology in the country. He also noted that if sales tax is already imposed on phones, additional income tax may not be necessary.
Qamar also stressed that a clear and transparent tax policy on mobile phones should be presented in the upcoming federal budget.
The Tax Policy Office assured the committee that the recommendations would be considered in the budget for the next fiscal year. He added that allowing modern technology into the country would help strengthen the economy.
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