In a move to benefit overseas Pakistanis, the depreciation rates on used or refurbished mobile phones brought into the country have been increased from 30 percent to 60 percent for the assessment of duties and taxes. This adjustment, outlined in the new valuation ruling number 1834 of 2023, provides significant relief to incoming international passengers bringing mobile phones into Pakistan.
Under the ruling, overseas Pakistanis stand to gain the most, as the increased depreciation rates, now at 60 percent for phones up to five years old, facilitate a progressive taxation policy on the import of mobile phones for personal use. However, commercial importers of new mobile phones will face higher duties and taxes based on comparatively elevated customs values.
The Federal Tax Ombudsman (FTO) had directed the Federal Board of Revenue (FBR) to apply appropriate depreciated values based on the physical condition and model of used mobile phones, preventing unwarranted overcharging. The FTO emphasized consistent and uniform valuation methods unless clear evidence of mis-declaration is present.
This new ruling aims to decrease the margin of under-invoicing for existing and new models of branded mobile phones. It also incorporates depreciation allowances for used or refurbished mobile phones imported by bonafide passengers, ensuring a fair assessment based on tabulated values.
For assessment of brands and models not included in the ruling’s annexure but imported in commercial quantities, clearance Collectorates are advised to assess them under Section 81 of the Customs Act, 1969, and forward a reference to the Directorate for the final determination of values.
