The National Assembly Standing Committee on Finance on Thursday recommended a reduction in mobile phone taxes as lawmakers reviewed the collection of duties and taxation structure on imported and locally assembled devices.
Tax officials assured the committee that the matter would be reviewed during the upcoming fiscal year budget process.
The meeting was briefed by Chairman Federal Board of Revenue (FBR) Rashid Mahmood Langrial and officials from the Tax Policy Office.
It was informed that imported mobile phones priced above $500 are currently subjected to a total tax burden of around Rs. 76,000, with an overall tax rate of 54 percent.
Imported devices in the $700 to $750 range face an even higher tax rate of about 55 percent.
Officials told the committee that imported mobile phones are taxed at 54 percent of their value, while locally manufactured or assembled phones are taxed at a reduced rate of around 25 percent.
The committee was further informed that an 18 percent general sales tax (GST) is currently applicable on mobile phones, along with concessional income tax and a withholding tax of approximately Rs. 11,500 on expensive devices. FBR officials stated that there is currently no scope to reduce the existing 18 percent GST or withholding tax.
Committee Chairman Sayed Naveed Qamar emphasized the need to encourage modern technology in the country, stating that it contributes to economic improvement. He added that when sales tax is already being applied, there is no justification for additional income tax on mobile phones.
He also urged that a clear and transparent mobile phone taxation policy be presented in the next federal budget to avoid uncertainty in the system.
no one pays pta tax . most use with wifi