In a major development affecting Pakistan’s digital landscape, the new budget has imposed significant taxes on mobile phones, which could affect the viability and growth of the industry.
The government has imposed a sales tax of 18% to 25% on mobile phones, raising concerns among consumers and industry stakeholders.
Mobile phones, once heralded as a necessity and catalyst for digital growth, are now becoming more expensive due to these taxes.
Critics argue that such drastic decisions were taken without adequate consultation, adversely affecting digital inclusion and economic growth.
Local manufacturers of global mobile phone brands in Pakistan face immediate challenges as they aim to boost competition and increase employment. Experts predict difficulties in absorbing rising costs and warn of rising prices that could reduce consumer demand.
In addition, the new budget imposes an advance tax of 75% on mobile balance recharge and increases the general sales tax (GST) from 15% to 19%. This means that for every $100 loaded into their mobile balance, users will receive only $5.50, placing a heavy financial burden on consumers.
The future of Pakistan’s mobile industry hangs in the balance amid these regulatory changes as stakeholders assess the impact on local manufacturing and consumer access and voice issues.
