BSS, Dhaka :
Mobile Network Operators (MNOs) of the country have urged the Government to reconsider some budget proposals such as SIM and corporate taxes.
The MNOs today at a press conference reiterated their demand for reduction of corporate tax and elimination of SIM tax as proposed in the budget for 2014-15.
They said Taka 300 SIM tax, Taka 100 SIM replacement tax and high corporate tax for the MNOs would continue to interrupt the growth of the mobile telecommunication sector.
Stating 3 per cent contribution of the mobile phone industry to country’s GDP in last year, the MNOs said: “It would be very challenging for MNOs to provide service at the current rate if the government does not address MNOs concerns.This would compel the MNOs to raise service charges as they can no longer continue to subsidize SIM tax on behalf of the subscribers.”
MNOs have long been harping on the need for elimination of the existing Taka 300 supplementary duties and VAT on SIM/RUIM cards. Tax on mobile connection is counterproductive as the tax on SIM connection increases the total cost of mobile phone ownership and thus reduces total tax collection by the government, they said.
Terming the proposed Taka 100 tax on SIM replacement as another hurdle placed in the way of the industry’s growth, they said it would only make the cost of service to the customers expensive.
In the proposed budget, corporate tax for non-listed companies have been reduced to 35 per cent from 37.5 per cent but unfortunately it has been kept unchanged for the MNOs at 40 per cent for publicly traded companies and 45 per cent for non-listed companies.
The MNOs think it will discourage prospective companies in mobile telecom sector to be listed with the capital market through floating Initial Public Offering (IPO) to vitalize country’s capital market.
“The initiative will also dampen the spirit of further foreign direct investment in this sector,” they observed.
MNOs expressed their dissatisfaction as there is no incentive for the mobile telecom sector in the proposed budget.
At the same time, the proposed 15 per cent VAT on mobile handset imports, on existing 10 per cent customs duty, will take the levy imposed on imported devices to 31.5 per cent, said the MNOs, adding, higher tax on legally imported handsets will only encourage the growth of illegal import of the item.
T I M Nurul Kabir, Secretary General, Association of Mobile Telecom Operators of Bangladesh (AMTOB) read out a written statement while representatives of MNOs clarified various aspects of the proposed budget.
