After attending the Senate Standing Committee on Finance meeting, the senior officials informed the media about the increase in regulatory duties. They unveiled that the government has proposed an increase in the rate of RD within the range of 10-20%. The duty on imported mobile phones valuing $60 or more than that will be increased.
Duty On Imported Mobile Phones Will Increase To Promote Import Substitution
The government has made a decision to increase Regulatory Duty (RD) on the import of cellular phones. The duty on the cell phones valuing $60 and above of any brands will be increased through the Finance Supplementary Bill 2018. They have estimated to collect approximately Rs 4.4 billion from this measure during 2018-19.
RDs play an effective tool in maintaining the stability of the account position, competitiveness of the domestic manufacturing sector and promoting import substitution. So, according to FBR, the government has decided to broaden up the RD regime to include additional luxury and non-essential items.
The new Tax slabs include:
- Rs 250/ phone (valuing less than $60)
- 10% RD for relatively expensive phones
- 20% RD for highly expensive phones
The Finance Supplementary (Amendment) Bill, 2018 has been presented before the Parliament by the government. However, the submission of the list of items on which the RD has been increased for 2018-19 is still pending. Finance Ministry has not submitted the list yet.
Federal Board of Revenue Member Customs, Zahid Kokhar stated that:
“We have made efforts to overcome trade imbalance and improve the balance of payment situation.”
He further added that higher duty will be imposed on the expensive cell phones.
The main purpose of the government behind this measure is to introduce fairness in its fiscal measures. They have made this step with regard to items where both the rich and the poor are should be treated alike.