The Telecom industry did rise a lot during the past five years due to no taxes and heavy influx of Wireless Broadband infrastructure. However, with the imposition of recent taxes, the import bill of this industry has gone down to 8.49% in the first two months of current fiscal year.In the recent Fiscal Budget, the taxes on telecom imports rise from 5% to 10%.

Taxes on Pakistan Telecom industry shrinks import size

Moreover, mobiles were also impacted by the sales taxes that range from 300 to 1000 depending on their category i.e. mid-tier to high-end. However, 200 import duty on every mobile has been abrogated.

According to the Pakistan Bureau of Statistics, the telecom imports recently registered a drop of 31%. Similarly, the telecom apparatus and accessories’ imports declined by 46.45% in the same period reporting a net loss of 59 million. Mobile phone imports were also showing a downward trend from July to August 2015 in which $105.38 million worth of mobile phones were imported. In the corresponding period of 2014, a total of $115.16 million worth of mobile handsets were imported by the consumers.

Furthermore, the negative impact is the increasing cost of delivering the products that is immediately passed on to the consumers. It will also damage the foreign company’s interest in the Pakistani market, if this trend keeps on hiking.