The Federal Board of Revenue (FBR) Chairman Rashid Langrial on Saturday informed the National Assembly Standing Committee on Finance that taxes on mobile phones would be reduced by 20 percent, as the committee approved a proposal to abolish the regulatory duty imposed on smartphones to make digital devices more affordable for consumers.
The committee, chaired by MNA Syed Naveed Qamar, reviewed the taxation regime on imported and locally assembled mobile phones and expressed strong dissatisfaction over the government’s failure to honour assurances given before the budget regarding the withdrawal of various taxes and duties.
During the briefing, FBR Chairman Rashid Langrial said regulatory duty was currently applicable only to higher-end smartphones. However, committee members argued that despite repeated commitments by tax authorities, no meaningful relief had been provided to consumers in the federal budget for 2026-27.
PPP lawmaker Ali Qasim Gilani told the committee that he had been pursuing the issue of mobile phone taxation for the last six months. He said both parliamentary committees had been assured that taxes on mobile phones would be rationalised, but the commitments remained unfulfilled.
“Consumers and businesses are disappointed that no relief has been given in taxes and duties on mobile phones despite repeated assurances before the budget,” Gilani said, adding that reducing taxes was essential to make smartphones affordable and support the government’s Digital Pakistan agenda.
After a detailed review, the committee approved a recommendation for the abolition of regulatory duty on smartphones and called for broader reforms in the taxation structure on mobile devices.
FBR officials informed the committee that mobile phones valued up to $30 currently face a tax incidence of 25 percent, while devices priced between $31 and $100 are subject to an effective tax rate of 36 percent.
The tax burden rises further for higher-priced devices. Phones valued between $101 and $200 attract an effective tax rate of 40 percent, while those in the $201-$350 category face a tax incidence of 38 percent. Smartphones priced between $351 and $500 are taxed at 40 percent, whereas devices worth more than $500 face an effective tax burden of 41 percent.
Officials said the tax payable per handset ranges from around Rs1,500 to as high as Rs141,500, depending on the value of the device. They added that nearly 44 percent of imported mobile phones fall within the $31-$100 category, while the average effective tax rate across all imported phone categories stands at 39.6 percent.
Committee members also highlighted the growing presence of millions of non-PTA-approved mobile phones in the market and urged authorities to introduce an instalment-based payment mechanism for taxes and duties on mobile devices.
“There are instalment facilities for even small consumer products around the world. Similar options should be available for mobile phone taxes,” members observed.
The committee directed the FBR and the Pakistan Telecommunication Authority (PTA) to jointly develop a proposal for an instalment-based tax payment system and present it before the committee.
