ISLAMABAD: Chairman FBR Rashid Mahmood Langrial assured the National Assembly Standing Committee on Finance of a 20 percent reduction in regulatory duty imposed on imported mobile phones.
According to Express News, a meeting of the National Assembly Standing Committee on Finance was held on Sunday under the chairmanship of Chairman Committee Syed Naveed Qamar, in which important issues related to taxes imposed on imported and local mobile phones, auto policy, electric vehicles and import duties were discussed in detail.
In the meeting, Chairman FBR assured a 20 percent reduction in regulatory duty imposed on imported mobile phones and said that the possibility of reducing tax on mobile phones worth up to $200 can be examined.
Brieflying the meeting regarding taxes on mobile phones, FBR officials said that the tax rate on mobile phones worth up to $30 is 25 percent, 36 percent on phones worth $31 to $100, 40 percent on imported phones worth $101 to $200, 38 percent on phones worth $201 to $350, 40 percent on smartphones worth $351 to $500, while the effective tax rate on phones worth more than $500 is 41 percent.
According to officials, the tax rate also increases with the increase in the price of mobile phones and the tax per unit increases from Rs1,500 to Rs141,500. The briefing said that 44 percent of imported phones fall under the low-tax category of $31 to $100, while the average effective tax rate across all imported phone categories is 39.6 percent.
During the meeting, the committee members pointed out that there are currently millions of non-PTA mobile phones in the market and an installment system should be introduced to pay taxes on mobile phones.
The members said that installment facilities are available even on small items around the world. On this, the chairman of the committee, Syed Naveed Qamar, directed the FBR and PTA to jointly present a workable plan for the installment system.
Committee member Hina Rabbani Khar, raising questions about taxes on mobile phones, said that this measure is only for revenue or to provide protection to a company, while she said that there should not be such a huge financial burden on the purchase of any type of mobile phone.
On this, the Chairman FBR said that the revenue generated from mobile phones is part of the national revenue target, Rs 37 billion in tax is collected annually from imported mobile phones, while Rs 21 billion is collected from Apple phones alone. He said that the reduction in the slab of low-cost phones will result in a financial difference of about Rs 1 billion, which will have to be met from some other source.
The Secretary Finance also supported this position, while committee member Javed Hanif Khan said that the parliament is not bound by anything and if it does not agree, it can clearly give its opinion.