In a surprising move, the Federal Board of Revenue (FBR) imposed sales tax ranging between Rs 150 to Rs 500 on import of all types of mobile phones whereas tax was also imposed on sale and activation of SIM cards.
On the import of cheap mobile phones‚ Rs 150 per unit sales tax will be payable‚ Rs 250 on expensive mobiles while Rs 500 would be payable on the import of smart phones.
In a notification issued by FBR, tax rates on mobile phones were revised downwards with three slabs and tax collection at the time of sale of each new SIM was re-imposed.
This new notification, SRO 460 of sales tax, said tax on mobile phones will be collected at two levels, one at source while another collection will be made at the time of sale of each new SIM.According to the SRO, Rs 150 sales tax is imposed on phones with a 2.0 mega pixel camera or less, and or with a screen size of 2.6 inches or less. A tax of Rs 250 will be deducted at source for all dual camera phones (front and rear) with cameras ranging from 2.1 to 10 mega pixel, screen size of 2.6 inches to 4.2 inches or with processors lesser than 2.0 GHz.
Rs 500 tax will be deducted at source if the phone has cameras of over 10 mega pixel resolution, touch-screen with more than 4.2 inches and/or dual-core or higher processors.
All iOS phones, Android 2.3 or higher, Windows 8 or Blackberry devices will qualify for a Rs 500 tax automatically.
Moreover, Rs 250 as sales tax will be deducted from mobile phone operators on sale of each new SIM. With this, the activation tax on new SIMs, which was – according to the April 4th SRO – transferred to mobile phone imports, is now re-applied.
Mobile phone companies will have to maintain proper records of all SIM cards sold or activated for a period of three years.
FBR imposes tax on import of mobile phones
