During a meeting of the National Assembly’s Standing Committee on Finance, the Federal Board of Revenue (FBR) responded to concerns over high taxes on imported mobile phones, particularly iPhones, clarifying that the levies apply mainly to imported handsets and are intended to protect and encourage local manufacturing.
Key Points from the Meeting
- FBR Chairman Rashid Mahmood Langrial informed lawmakers that around 95% of mobile phones sold in Pakistan are now produced domestically.
- Taxes on imported phones including iPhones are part of a policy to promote local assembly and manufacturing while generating revenue from luxury imports.
- The specific case discussed was a Rs. 150,000 tax on certain iPhone models, which applies due to their being imported as fully built units.
Context
The discussion followed a petition submitted by the Federation of Pakistan Chambers of Commerce & Industry (FPCCI), which highlighted concerns over high mobile phone taxes affecting consumers and businesses. The FBR clarified that the tax structure differentiates between locally assembled phones which enjoy tax concessions and imported luxury models.
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FAQs
Q1: Why are iPhones taxed so heavily in Pakistan?
A1: iPhones are fully imported and categorized as luxury items. The tax aims to encourage local production, protect the domestic mobile industry, and generate revenue from high-end imports.
Q2: How much is the tax on iPhones?
A2: During the meeting, reference was made to a Rs. 150,000 tax on certain iPhone models, though the amount can vary based on the device’s value and import category.
Q3: Are all mobile phones taxed this way?
A3: No. According to the FBR, about 95% of phones in Pakistan are produced locally and face lower taxes. Higher duties apply mainly to imported phones like iPhones, Samsung flagships, and other foreign-assembled devices.
Q4: What is the FBR’s main argument for this tax?
A4: The FBR states that the tax structure is designed to support local manufacturing, reduce import dependency, and ensure that luxury item imports contribute fairly to the national exchequer.
