Tax office introduces new levy on handsets

10 Apr 2013

Pro Pakistani writes that the Federal Board of Revenue (FBR) has imposed new taxes of PKR1,000 (USD10.07) on the import of every smartphone and PKR500 for every other non-satellite handset. The measures are expected to bring in an additional PKR5 billion per year for state coffers, though consumers are expected to see an increase in costs for devices. The FBR has defended its position, arguing that the new levy replaces a now-obsolete PKR250 charge on the activation of SIM cards, traditionally paid by the service provider rather than the end-user. The tax office added that the charge represents a 2% tax on smartphones of PKR50,000, claiming that most new handsets sold for PKR80,000 or more, overlooking the substantial budget market: Pro Paksistani notes that Chinese-made touch-screen handsets are available for PKR3,000.

For the purpose of the tax the FBR defines a smartphone as a cellular mobile with any of the following characteristics: 4GB of memory, touch-screen, dual core processor, 5 Megapixel camera or an operating system using iOS, Android version 2.3, Android Gingerbread, BlackBerry or Windows 8.