Karachi Chamber of Commerce & Industry (KCCI) President Shamim Ahmed Firpo on Thursday urged the federal government to reduce sales tax on feature phones (Category-A) to maximum of Rs 150 per phone which recently has been raised to Rs 650 in federal budget 2017-18 as compared to Rs 300 of budget 2016-17.
In a letter to Federal Finance Minister Ishaq Dar, Firpo conveyed concerns of importers and wholesalers of mobile phones over the increase in sales tax on imported mobile phones which has been raised to an unrealistic and exorbitant level in the recently announced federal budget 2017-18.
KCCI president maintained that sales tax on mobile phone (feature category), which is comparatively a basic and cheaper phone, has been raised from Rs 300 to Rs 650 per phone along with an additional regulatory duty of Rs 250, which means that the total taxes and duties have been raised by around 112 per cent on an imported phone of Rs 800 only which is a sheer injustice not only to the concerned traders but also to the poor and down trodden segment of society.
According to rough estimates, the government may not be able to earn much revenue by imposing exorbitant taxes and regulatory duties on mobile phones.
In fact, this step will prove counterproductive as it will discourage legal imports and encourage smuggling which will not only affect the local business and raise unemployment but will also result in loss of revenue to the national exchequer, Firpo added.
KCCI president hoped that keeping in view the hardships being faced by the traders; the government will pay attention to this serious issue by restoring sales tax of federal budget 2016-17 on all three categories.
He hoped that the sales tax on Feature Phone (Category A) will also be reduced to Rs 150 per phone.