Govt Imposes Uniform Tax on Mobile Phones in Budget 2024
Staff Report
The government has proposed a uniform tax on mobile phones in the budget for the financial year 2024-25.
According to the budget document, this uniform taxation aims to ensure equal opportunities for everyone and enhance market efficiency. The proposed sales tax rate for all types of mobile phones is 18%.Mobile Phone Makers Urge FBR To Honour Commitments
The budget document sets a target of Rs 24.81 billion from mobile phone duties for the next year.
While presenting Pakistan’s budget for the fiscal year 2024-25, Finance Minister Muhammad Aurangzeb outlined a total budget of Rs 18.877 trillion, emphasizing special attention to the IT sector.
He highlighted that, due to favorable government policies, IT expenditure is expected to reach $3.5 billion this year. The government is proposing an allocation of Rs 79 billion for the IT sector, designated for various purposes:
- Rs 7 billion for digitization within the Federal Board of Revenue to support efforts in expanding the tax base and eliminating system loopholes using modern IT systems.
- Rs 8 billion for creating an IT Park in Karachi.
- Rs 11 billion for the Technology Park Development Project in Islamabad.
- Rs 2 billion for the Pakistan Software Export Board, aimed at supporting IT sector exporters and providing internships for students in IT firms.
- Rs 20 billion for the Digital Infrastructure Information Initiative.
Additionally, the government plans to establish a National Digital Commission and a Digital Pakistan Authority to leverage digital technologies for the country’s socio-economic development, with Rs 1 billion proposed for these institutions.
Commenting on taxes, telecom industry said that the budget proposals regarding the imposition of sales tax on mobile handsets below $500 and imposition of 75% advance tax on telecom usage for persons mentioned in the income tax general order will adversely impact the provision of essential connectivity, digitalization initiatives and internet usage in the country, pushing it towards the dark ages.
