Despite the aim to implement adjustments within the smartphone market, the government has yet to carry out a majorly approved suggestion of the Mobile Device Production Policy for the removal of set sales tax on CKD/SKD manufacturing of mobile devices i. e. about $200.
Concerns were raised regarding the future implementation of this policy to which the Ministry responded that all approved recommendations regarding the respective policy were implemented apart from the fixed Sales Tax one which would be applied soon.
In addition , the Ministry mentioned that the Division had forwarded the non-implementation at a vide summary on the 4th of December 2020 to the ECC which Case No . ECC-452/ 61/ 2020 dated 16-12-2020 was approved.
To put it briefly, what this means is that locally manufactured phones that are valued greater than $200 shall face the removal of sales tax once the particular direction with the proper strategies has been by the Ministry of Industries and Production whilst keeping the Finance Department, Federal Board of Income (FBR), and relevant stakeholders in the loop as consulters.
However , the FBR has maintained the difference between the CBU and responsibility in flat rates for six different slabs according to the import value of the cellphones vide FBR SRO 840(I)/2021 dated June 30, 2021, which has further encouraged local smartphone manufacturing.