The government introduces an extra sales tax on mobile phones

The federal government has unveiled a sweeping reform of the existing tax structure, introducing significant changes that will impact various sectors. A central element of this reform is the introduction of an 18% sales tax on several categories of mobile phones, a move poised to affect both consumers and the telecommunications industry broadly.

The Finance Ministry’s latest budget proposal details several pivotal decisions, including the elimination of numerous sales tax exemptions and the implementation of standardized tax rates on a diverse array of goods. Among the notable changes is the imposition of withholding tax on commodities such as copper, coal, paper, and plastic scrap. Additionally, the government has decided to withdraw tax exemptions on the import of luxury vehicles and increase taxes and duties on imported vehicles valued at fifty thousand dollars or more.

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Furthermore, the new policy abolishes import duties on glass products, likely aiming to support the local construction industry. Conversely, there will be an increase in duties on the import of steel and paper products, reflecting the government’s intention to protect domestic manufacturers from international competition.

Finance Minister Muhammad Ishaq Dar emphasized that these measures are part of a broader strategy to stabilize the economy and ensure a more equitable tax system. “Our goal is to create a fair tax environment where every sector contributes its due share to the national exchequer. These changes are essential for our fiscal health and long-term economic stability,” he stated.