The taxes on mobile imports are increasing year on year. Due to which the imports of the devices has been affected. Lahore/Karachi & Islamabad Electronics Dealers Associations have concerns that the mobile industry might experience downfall due to huge taxation on mobile imports. With the upcoming budget, the industry is expecting the same increase as before and associations have appealed to the Government of Pakistan for reducing taxes for providing some relief and avoid any collapse.

Increased Taxes are threatening the mobile phone industry.

Last week a meeting was held to discuss issue relating to the payment of increased taxes in Pakistan mobile sector. The meeting was chaired by Chairman FBR where he proposed the option of Forensic audit to scrutinize the telecom operators that have claimed more tax payment. FBR chairman informed the meeting that there is 14 percent direct tax on telecom services with provinces collecting 18.5 percent sales tax from its consumers.

The mobile industry claims that they are already heavily taxed and more taxation may lead to damage in imports of mobile phones. FBR Chair has said that there would be relief in taxes and duties next year for the importers and telecom operators. They also have given details on what would be the effect of increased budget on mobile imports in coming year.

• Substantial increase in the illegal/grey traffic of mobile handsets.
• Worsening of law and order situation due to illegal/grey traffic of products procured from different regions.
• Unqualified misery to the lives of mobile phone importers.
• Downsizing in the sector resulting in a significant contribution towards the menace of unemployment.
• Burden on the buying power of the consumer against each purchase of a mobile handset.
• A significant decline in revenue paid in shape of duty and taxes by importers.
• Deterioration of the quality of operators due to an influx of alien products instead of proper pre-tested and official distribution stocks.