The Senate Standing Committee on Information Technology and Telecommunication, with a majority vote, has recommended the import of one mobile in personal baggage and asked the same from the FBR.
Briefing the Senate Standing Committee on Information Technology and Telecommunication, Chairman FBR Shabbar Zaidi said that baggage rule was misused in the past, compelling the government to withdraw the facility and resulting in duty/taxes being applicable on every mobile handset import.
He added that the recommendation for allowing duty-free import of Mobile Phones under the baggage rule would be tabled before the federal cabinet.
FBR Under Fire for Taxing All Mobile Phone Imports:
The parliamentary panel, which met with Rubina Khalid in the chair, dismissed FBR’s suggestion to withdraw the facility and stated that instead of blocking loopholes in the system and improving check and balance, the Board took away the facility which annoyed international passengers, especially overseas Pakistanis, hurting every segment of the society including students and other individuals.
The Ministry of Information Technology and Telecommunication (MoITT) confronted FBR on taxes on mobile phone imports, saying that it was affecting the IT sector’s growth negatively as well as the digital agenda of the government.
The senators from the government benches also opposed the government’s decision of imposing a duty on import of even a single mobile phone handset. The committee recommended to suspend an order of FBR and allow one duty-free mobile phone import under the baggage rules and passed the motion with a majority.
The Committee was of the view that wealthy people can afford any price of phones and taxes levied on them but the larger part of the population, who are using phones for multiple purposes, cannot afford it.
FBR gave a briefing on reasons for the withdrawal of customs duty exemption on the imported phone per the calendar year under the personal baggage rules.
It informed the committee that the duty-free allowance on the import of mobile phones was withdrawn because the facility was being misused. Data of international arriving passengers was being stolen and the passport numbers and flight data was being used to enter data details in the Mobile Device Registration Software to claim an exemption under the baggage rules.
Furthermore, the government desired that there should be uniformity in the application of duty/taxes whether brought into Pakistan by passengers or locally procured and, therefore, the exemption was withdrawn to avoid this anomaly.
Pakistan Telecommunication Authority (PTA) said that more than 0.6 million units were imported under the baggage rule and most of them were high-end and expensive, and it was reported that the facility was being misused. He further said that taxes were reviewed and reduced for commercial and baggage imports.
He further said that more than 10 million mobile phone handsets were imported during 2018-19 and the government collected around Rs 28.8 billion in taxes. However during the first four months of the current fiscal year, around 7.6 million phones were imported and the government collected Rs 15.1 billion under the head of duties and taxes, indicating that imports increased.
Senators Faisal Javed and Shahzad Waseem said that mobile phones are not only for calls but also for businesses.
The meeting was attended among others by Senators Kalsoom Parveen, Shehzad Waseem, Faisal Javed Khan, Maulana Abdul Ghafoor Haideri, Abdur Rehman Malik, Sana Jamali, Fida Muhammad, Hasil Bizenjo, Chairman FBR, Secretary IT&T, SSP Rawalpindi, Director Cyber Crimes FIA and other officials.