The government is planning to impose taxes on the domestic mobile phone manufacturing industry, which has been enjoying fiscal incentives.

In the upcoming budget for Fiscal Year 2023-24, taxes may be increased for local mobile phone assembly and the import of raw materials.

Mobile phone assembly is subject to a 3.0% to 5.0% value-added tax (VAT), while taxes are waived on the import of raw materials under certain conditions.

However, the National Board of Revenue (NBR) recently imposed a 5.0% VAT on mobile handset sales and local refrigerator manufacturers, ending the previous VAT exemption.

Imported handsets still face high taxes, with smartphones being subject to a 58% tax.

The government is considering extending tax benefits for one more year to the local home appliance manufacturing industry to promote the ‘Made in Bangladesh’ brand.

Several global brands and local pioneer Walton have invested in Bangladesh due to the government’s fiscal incentives for mobile phone manufacturing.

Bangladesh Telecommunication Regulatory Commission (BTRC) data reveals that 15 plants have been established in the country, producing 103.5 million handsets by 2022.

While officials argue that the sector has flourished under the tax benefits, others believe it is time to phase out these benefits.
However, mobile phone manufacturers have expressed concerns over declining sales, attributing it to price hikes resulting from tax adjustments.

The government is considering taxing the domestic mobile phone manufacturing industry and may extend tax benefits to the local home appliance manufacturing industry for another year.