Regulatory duty and penalty to be imposed on unregistered mobile phones

ISLAMABAD: The government has determined in law for initiating regulatory duty (RD) along with slight penalty on unregistered mobile phone sets that are in use already.

According to the law, once the mobile phone gets blocked then can only be unblocked by completion of Regulatory duty (RD) payment along with the penalty at the nearby customs point.

As per data, it is predicted generally that almost $1.5 billion revenue loss is tolerated by the government exchequer per year due to trading of illegal phones in the market .

Furthermore, the lawful imports worth of mobile phones has touched to almost $847.656 million in 2017-18. But, over the past few years, the legal imports of mobile phones have plunged, which use to cross $1bn at some time.

It needs to be mention here that a number of pre owned and renovated mobile phones that are being smuggled into the country, by means of various channels will be blocked through Device Identification, Registration and Blocking System (DIRBS) mechanism.

DIRBS mechanism was launched in May 2018, by the Pakistan Telecommunications Authority (PTA) to contradict the extensive usage of inferior quality and used phones that are being smuggled to Pakistan.

According to sources, from November 15 onwards, it will be mandatory for all the consumers to send a text message to 8484 consisting of the International Mobile Equipment Identity (IMEI) number, that is printed on the box of a new mobile phone.

Eventually, the consumers will obtain a reply whether their hand set is acquiescent with the regulatory standards or not. But, in case of non-compliant, a message will be delivered to the consumer to pay the customs duty along with penalty within two months, after which the unregistered mobile phone can be usable.

According to the PTA data, before the launch of DIRBS mechanism, almost 160 million compliant and non-compliant mobile devices are observed active on all the networks.

However, the government is still working on formulating regulatory duty rates for used mobile phones which will be soon notified after approval of the federal cabinet.

According to sources, three different summaries will be sent to the cabinet in this regard, as these summaries will be submitted by the information and technology department, commerce division and the Federal Board of Revenue (FBR).

At present, FBR has declared new rates of regulatory duties on import of new mobile sets, that is Rs250 per mobile set worth less than $60. The rate of regulatory duty is 10% of the value of mobile phone if its cost is between $60 to $130. However, 20% regulatory duty will be imposed on the mobile phone sets of cost more than $130.