Imported mobile phones will become less expensive as the government plans to reduce taxes in the FY24 budget.

The Federal Board of Revenue (FBR) is conducting a significant assessment of the levies and tax system on mobile phone imports, a budget maker informed ProPakistani late Tuesday.

According to sources, the proposed relief package would have a negative revenue impact on FBR collection in fiscal year 2023-24 (FY24).

“The tax policy on mobile phone imports has been completely revised in the coming budget,” a top FBR official said.

The FBR is likely to maintain an 18% sales tax on the import of mobile phones, while the FBR has imposed a 25% sales tax on the import of luxury commodities. The structure of the sales tax and the withholding tax would not be changed in the upcoming budget. However, customs and regulatory charges on imported mobile phones are proposed to be decreased further beginning July 1, 2023.

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The regulatory tariff (RD) on mobile phone imports was decreased by 50% from April 1, 2023. The withdrawal of the FBR’s SROs on March 31 simply eliminated the component of the raised RD rates, while the original notification of the RDs remains in place.

On the import of mobile phones, the buyer must pay withholding tax as well as a fixed mobile levy. The usual rate of sales tax on the import of mobile phones has also been raised from 17 to 18 percent.