The government is preparing to cut taxes on mobile handsets in the upcoming 2026–27 budget, aiming to accelerate the adoption of 5G-ready smartphones and support local manufacturing. According to officials, high-level committee led by the Finance Secretary and the Chairman of the Federal Board of Revenue is finalizing proposals for the tax rationalization.
The move comes ahead of a landmark spectrum auction expected to more than double Pakistan’s available airwaves for mobile services, from 274 megahertz to around 600 megahertz.
The auction will follow a technology-neutral framework, allowing operators to deploy spectrum for 2G, 3G, 4G, 5G, and future technologies such as 6G. Officials say the expanded spectrum will help ease chronic network congestion, improve call quality, and boost data speeds, particularly in densely populated urban areas.
Concerns over low 5G handset penetration are not expected to delay the auction. The Pakistan Telecommunication Authority is engaging local manufacturers to encourage the production of compatible devices, and the initial 5G rollout in major cities is expected to coincide with the growing availability of 5G smartphones. Analysts point to examples such as Sri Lanka, where early spectrum allocation succeeded despite minimal initial 5G device adoption.
Industry experts say that, under the technology-neutral approach, operators will also be able to strengthen existing 4G and 3G networks immediately, delivering benefits to the majority of mobile users while preparing for the next generation of connectivity. Officials said further details regarding spectrum bands, pricing, and timelines will be announced in the coming weeks, marking what many in the sector view as a critical step in strengthening Pakistan’s digital infrastructure and supporting broader economic growth.
