Mobile Phone Exports at Risk as Local Production Shrinks Due to Tax Hike

Pakistan’s mobile phone manufacturing industry is facing a decline following the imposition of the 18% sales tax in the budget 2024-25, according to Aaj News. The tax hike has reportedly slowed down local production, leaving both factory owners and employees concerned about the industry’s future.

Zeeshan Mian Noor, CEO of Innovi Technologies, shared his insights on the issue, explaining that local production has dropped significantly. “We were manufacturing 3 million units by importing raw materials, but this has now shrunk to 1.8 to 1.9 million units,” he revealed during a media talk.

Moreover, the inconsistency in taxation policies has left mobile manufacturers disappointed and uncertain about the future. Consequently, they have urged the government to introduce a rebate policy, which could help stabilize the mobile manufacturing sector and boost production.

Despite these setbacks, the government of Pakistan has set an ambitious goal of achieving $5 billion in mobile phone exports over the next five years. Industry stakeholders agree that mobile phone exports could double and even exceed our expectations if the government provides much-needed tax relaxations.

However, without such policy support, the mobile phone manufacturing sector faces a challenging road ahead, and the country’s export goals may remain out of reach. Stakeholders continue to call for urgent reforms to ensure the sector’s growth and sustainability.

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