Recent tax incentives from the government have prompted at least three new mobile phone companies to build production facilities in Pakistan.
The government announced tax incentives for mobile phone assembly/production in May last year, exempting locally assembled and manufactured phones from a domestic sales withholding tax of 4 percent.
This announcement ignited interest in the establishment of plants in Pakistan for Vivo Mobiles, Airlink and Advance Telecom.
The Cabinet’s approval of Pakistan’s first-ever mobile device making policy would assist the industry. Cheaper mobile sets from overseas countries have threatened Pakistan’s local market, especially India. In an effort to eradicate the danger, the government has abolished the withholding tax on locally manufactured mobile sets.
The PTA has also published Mobile Device Manufacturing Regulations 2021, where it will be responsible for monitoring and implementing the policy. Under the PTA regulations, manufacturing/assembly plants will be expected to provide full details on land finance, investor nationality, etc.