FBR is Making Hundreds of Billions from Taxes on Mobile Phone Imports

The Federal Board of Revenue (FBR) has generated Rs. 122 billion revenue on account of taxes/duties on commercial import of mobile phones/devices since the implementation of Device Identification Registration and Blocking System (DIRBS).

Official documents revealed that commercial imports have grown by up to 125 percent in three years, while revenue collected by the Federal Board of Revenue (FBR) on these imports crossed Rs. 122 billion between 2018 and 2021.

Further, in the individual import category, the government collected Rs. 35 billion between 2019 and 2021. Prior to the implementation of DIRBS, this was an untapped area, with no revenue collection in this category.

Following its successful launch in 2019, DIRBS entered its third year of seamless functioning. The system continued to achieve its specific objectives of eliminating the grey handset market in Pakistan and getting rid of counterfeit, substandard, and non-GSMA approved handsets.

The wider impact of DIRBS entailed a sharp decrease in incidents of snatching and theft of mobile handsets, increased government revenues, a newly established handset manufacturing ecosystem, and 100 percent registered handsets across all cellular networks of Pakistan.

Following is the impact of DIRBS on the status of blocked, banned, and barred devices in Pakistan:

  • 26.03 million fake/replica mobile devices blocked.
  • 175,000 International Mobile Equipment Identity (IMEI) devices (reported stolen) banned.
  • 880,780 IMEI devices identified as cloned/duplicated against 5.28 million MSISDN barred on networks.

DIRBS has created a level playing field for all entities in Pakistan, resulting in the establishment of local assembly plants. In view of the successful development of this industry, PTA issued MDM Regulations, 2021, per the Mobile Manufacturing Policy issued by government in June 2020. The policy offers incentives including tax exemptions etc., for all entities that establish manufacturing plants in Pakistan.

As many as 30 local and foreign companies — both standalone and joint venture — have obtained 10-year MDM authorization from PTA and have established manufacturing plants for the purpose. Leading brands including Oppo, Vivo, Nokia, Tecno, and Infinix, among others, have established their plants in Pakistan. Local manufacturing has enabled smartphone manufacturing in Pakistan, created job opportunities in skilled areas, and promoted affordability for consumers.