Mobile phone prices skyrocket in Pakistan: 18% tax hike hits consumers hard

ISLAMABAD: In a move that is set to hurt consumers, mobile phone manufacturers in Pakistan have increased the prices of all models by up to 10,000 rupees (approximately $50) following the imposition of an 18% tax on mobile phones in the recent budget.

According to sources, the price hike affects both smart and feature phones, with some models seeing an increase of up to 10,000 rupees. The Mobile Phone Manufacturing Association had warned the government that the tax would lead to higher prices and harm the country’s digital vision.

Despite the warnings, the government went ahead with the tax, leading to the price increase. The move is expected to hit consumers hard, especially in a country where mobile phones are an essential tool for many.

The development comes at a time when Pakistan’s mobile phone manufacturing industry was showing signs of growth, with a 55% year-over-year increase in production in May 2024. The industry has also seen a significant shift towards local manufacturing, with 95% of mobile phones now being produced in the country.

The price hike is expected to affect sales and may reverse the gains made by the industry in recent years.