The mobile phone sales have dropped after the imposition of new taxes and duties in the budget 2019-20. Traders at the biggest mobile phone markets in Lahore, Hall road and Hafeez Centre, told Ace News that mobile phone sales have been dropping continuously since the imposition of heavy duties and taxes on mobile handsets in the budget. The prices have gone up and demand slumped.
Both the whole sale and retail business is experiencing decline. The cost of business including shop rents and utility bills have gone up significantly in last one year. The decline in sales means many small shopkeepers will not be able to pay rents and forced to close down their business. The high inflation and falling incomes are also contributing in the decline of mobile phone business.
According to the shopkeepers at Hafeez Centre, it was not difficult for a shopkeeper to sell a dozen or so mobile phones in a day before the introduction of the Device Identification Registration and Blocking System (DIRBS) and new tax regime. However, a massive increase in duty and taxes on the mobile handsets has compromised consumers’ purchasing power.
They explained that before the imposition of new taxes, “if a consumer could not afford a new handset, he could find a good bargain in the used mobile market. However, thanks to cases of illegal mobile phone registration by stealing the data of international travellers have shaken consumer confidence in used devices. Now people are reluctant to buy used devices, badly hurting the business of small traders.
In a recent meeting of the Senate Standing Committee, it was revealed that over 47,000 international travellers’ data had been misused for illegal registration of mobile phones through the DIRBS. Several FIA officials have been arrested for their involvement in data leaks and illegal mobile registration.
To curb illegal mobile phone registration, the government has withdrawn the baggage rule facility that allows international travellers to bring one mobile phone in tax-free. As per the Finance Bill 2019, the government has imposed duty and taxes of Rs370 to Rs36, 720 per handset for the commercial importer and Rs300 to Rs31, 520 for passengers under the baggage facility.
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17 November, 2019