Telcos protest hefty taxes
Mobile phone operators yesterday protested the government's plan to impose hefty taxes on the use of mobile phone in the budget for next fiscal year.
They demanded withdrawal of supplementary duties and surcharge on all services and VAT on internet use.
The Association of Mobile Telecom Operators of Bangladesh (AMTOB) placed the demands at a press meet at Hotel La Vinci in Dhaka. The proposed budget is expected to be passed in parliament this week.
The operators suggested the government instead go for a comprehensive taxation policy. “The industry is already burdened with taxation processes at each stage of the value chain,” said TIM Nurul Kabir, secretary general of the association.
And that is why they are demanding an overall tax revision for sustainable growth of the economy, he added.
Kabir termed the corporate tax structure for mobile operators discriminatory. Currently the corporate tax rate for the telecom sector is 40 percent for listed and 45 percent for non-listed companies, and AMTOB said it should be reduced to 25 percent and 35 percent.
If the government withdraws the tax burden, its revenue from this sector will increase in the next two to three years; its contribution to GDP will also rise by 2-3 percent, said Kabir.
The finance minister had proposed to increase the supplementary duty by 2 percentage points to 5 percent, which was already made effective by a statutory regulatory order (SRO) on June 2.
Earlier, Tarana Halim, state minister for telecom, also urged the government to withdraw the supplementary duty for the sake of digitisation. A meeting on the issue is scheduled for today between the telecom division and the National Board of Revenue.
In the budget for 2015-16, the government first introduced supplementary duty on all kinds of mobile phone use.
The government introduced a 1 percent surcharge earlier this year as well.
Customers have also been paying 15 percent value added tax on their total usage in the last few years.
Operators said the sector saw revenue grow 4.5 percent a year and the government hiked taxes by 4 percent.
The finance minister also proposed to increase the duty on fibre optic cable imports to 15 percent, which is currently 10 percent.
Kabir said the government also proposed to increase the fees to appeal to the NBR tribunal to settle disputes to 50 percent of the total claim, from 10 percent at present.
In addition, the government wants to increase the VAT and tax on internet modems, routers and other internet equipment, and AMTOB has also requested the government to withdraw all these duties to enhance the digitisation process.
Senior executives of different mobile phone operators were also present.
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