Pakistan has significantly reduced the advance income tax charged on imported mobile phones priced between $101 and $200, bringing the levy down from Rs. 930 to Rs. 100 per handset.
The change represents a reduction of nearly 89% and is expected to lower the tax burden on a segment of imported smartphones. Alongside the advance income tax cut, the mobile handset levy has also been reduced, falling from Rs600 to Rs200 per device.
The tax changes could provide some relief to consumers looking to purchase imported smartphones in the affected price range. However, the overall price of a handset will continue to depend on several other charges.
Sales tax rates have not been changed under the latest measure. Other applicable duties and taxes will also continue to be collected, meaning the reduction in the two specific charges will not necessarily translate into an equal decrease in the final retail price.
The impact on consumers will also depend on how importers and retailers adjust their prices. If businesses pass the lower tax costs on to buyers, some imported smartphone models could become more affordable in the local market.
Finance Minister Muhammad Aurangzeb has confirmed that the announced tax relief has been implemented. He also indicated that there are currently no plans for additional changes to the mobile phone tax structure.
The latest adjustment comes as part of the government’s measures affecting the taxation of imported mobile handsets. For buyers, the key benefit is the sharp reduction in advance income tax and the lower handset levy, although the unchanged sales tax and remaining duties will continue to affect the final cost.
