July 26, 2024 – The Federal Board of Revenue (FBR) has unveiled a new sales tax policy set to significantly impact mobile phone prices across Pakistan. Effective from July 25, 2024, the updated Sales Tax Act of 1990 introduces a tiered tax structure for mobile phones, which is expected to lead to higher costs for consumers.
Under the new policy, mobile phones valued over $500 will be subject to a 25% sales tax, while devices priced below $500 will incur an 18% tax. This shift is part of a broader strategy to boost government revenue, but it is anticipated to particularly affect the prices of high-end smartphones, which are now facing a steep tax increase.
Additionally, locally assembled completely built-up (CBU) phones, as well as imports in completely knocked down (CKD) or semi-knocked down (SKD) forms, will also be taxed at the 18% rate. This adjustment aims to standardize tax rates across various categories of mobile phones and discourage over-reliance on imports.
While the FBR asserts that the policy is designed to enhance revenue collection, industry experts warn that it may result in a notable price hike for consumers, particularly those seeking premium mobile devices.
