The Pakistan Mobile Phone Manufacturers Association (PMPMA) has urged the Federal Board of Revenue (FBR) to maintain the current tax structure for mobile phone manufacturers. This comes amid reports that the government is considering imposing an 18 percent sales tax on mobile phone assembling units in the upcoming budget.
PMPMA representatives met with FBR officials and expressed concerns that increasing tariffs would disrupt the Mobile Device Manufacturing Policy 2020. This policy aims to encourage local assembly of mobile phones, a key driver of job creation and export growth.
The association highlighted that an 18 percent sales tax on all locally assembled phones would be detrimental to the industry. Currently, under the 2020 policy, phone sets priced under $350 are exempt from this tax. This exemption benefits the majority of local manufacturers, as they primarily assemble phones within this price range, catering to roughly 55% of the smartphone market in Pakistan.
PMPMA representatives warned that increasing taxes could lead to higher phone prices, impacting affordability for consumers. Additionally, they expressed concern that it could negatively affect Pakistan’s export targets for mobile phones.
The PMPMA has called on the FBR to honor government commitments made to investors and maintain the current tax structure. Negotiations are likely ongoing to find a solution that supports both government revenue goals and the growth of the local mobile phone manufacturing industry.
