Scrap the Tax on SIM Cards Say Bangladesh Politicians
A group of politicians have called on the Bangladeshi government to remove a sales tax on SIM cards in order to help boost mobile subscription rates in the country.
Currently there is a Tk 600 sales tax applied to SIM cards. The committee
says that the country's smaller networks are struggling to add new customers due
to the tax on SIM cards, which they are generally subsidising at considerable cost.
The parliamentary standing committee also recommended that the 12 percent import tax be replaced with a flat-rate duty of Tk100 per handset.
The flat-rate would match the rate proposed in 2010 by the Bangladesh Mobile Phone Importers Association (BMPIA) to help stem illegal imports. Currently it is cheaper to smuggle a handset into the country than to pay duty on it. The Tk100 per unit duty would reverse that situation.
The Committee accepted that the government would face a loss of revenue - but that this would be offset in the long term due to taxes on mobile network profits as their subscribe base grows.
There have been calls for the SIM card tax to be scrapped ever since it was introduced. Back in July 2009, the GSMA put out a report calling for the tax to be removed as it was harming subscriber growth.
During 2010, the dominant operator, Grameenphone absorbed the cost of the SIM tax. causing its net profit for the year to drop by 39%.
Grameenphone's CEO, Oddvar Hesjedal has previously said that "the SIM tax continues to be a significant barrier for the industry where operators, for the sake of industry growth, are taking dents in profitability by subsidizing the SIM tax."
On the web: The Daily Star