The government, on Wednesday, presented the Supplementary Second Amendment Bill, 2019 also known as mini-budget, in which alongside many other tax cuts and other changes, the tax rate on expensive mobile phones has also been increased.
In clarification of the decision, FBR members explained that this unified tax system was proposed for import of mobile phones. Handsets with the price value of up to Rs 10,000 will have a reduced tax rate of Rs 400 which was earlier Rs. 1025. While phones with a price tag of up to Rs. 28,000 will be liable for a tax rate of Rs. 4,000 which has been reduced from Rs. 4,360. However mobile devices up to the price of Rs.60,000 will be charged Rs.6,000 as tax, which is reduced from Rs. 6000.
Similarly, on the import of handsets having a price up to Rs.105,000, the tax is reduced from Rs. 8505 to Rs 8,000. However, the more expensive phones having a price tag of up to Rs. 150,000 has been increased from Rs. 22, 609 to Rs. 23,000. The phones having a price of up to Rs. 300,000 have witnessed the most tax hike, jumping from Rs 23,000 to Rs 40,000.
On import of mobile set having price up to Rs105,000, the tax rate is reduced from Rs8,505 to Rs8,000. The mobile phone set with a price of up to Rs150,000 has seen an increased tax rate from Rs22,609 to Rs23,000. On mobile phone set of up to Rs300,000, the tax rate has been jacked up from Rs23,000 to Rs40,000.
That is not all, in disguise of the increased tax rate on mobile phones, the cabinet also approved the reimposition of mobile phone service tax but finance minister did not mention it on the floor. Now, once again you’ll get around Rs 70 worth of credit upon loading an Rs. 100 top-up. Previously Supreme Court had barred the deduction of tax on pre-paid mobile cards, however, in this mini-budget, the government has approved a 30% tax cut on mobile cards.