Pakistan Government Proposes Tax Hike on Apple iPhones

The federal government in Pakistan has introduced a set of tax proposals for mobile phones, particularly targeting Apple iPhones, as part of the 2024-25 budget announcement. These proposals are currently pending approval from the parliament and are scheduled to come into effect on July 1, 2024.

According to the proposed finance bill, imported smartphones priced above $500, including Apple iPhones, will be subject to a 25% ad valorem tax. On the other hand, phones priced below $500 will face a standard 18% sales tax. This tax adjustment will impact the pricing of Apple iPhones in Pakistan significantly, given that Apple operates in the country through imports rather than local manufacturing.

Furthermore, locally produced smartphones will also be taxed at the 18% rate, aligning with the sales tax on lower-priced imported devices. If the proposal to increase the sales tax to 25% for phones valued above $500 receives approval, it is anticipated that the prices of various iPhone models, such as iPhone 11, iPhone 13, iPhone 14, iPhone 15, iPhone 15 Plus, iPhone 15 Pro Max, and iPhone 15 Pro, will see an increase in the Pakistani market.

The potential changes in the tax structure for Apple iPhones in Pakistan could lead to price adjustments for consumers. As the government aims to generate revenue through these tax revisions, it remains to be seen how the market and consumers will respond to the new pricing dynamics in the mobile phone sector.