Country’s mobile phone operators have urged the National Board of Revenue (NBR) to withdraw Tk300 tax from Subscribers Identification Number (SIM) cards for ensuring the growth of the telecom sector.
The leaders argued that the existing SIM tax is not only against the growth of mobile sector, but also contradictory to the government’s vision for establishing a Digital Bangladesh.
Mobile operators have already reached with their services even in the rural remote areas by subsidising the SIM tax from their own funds, said leaders of the Association of Mobile Telecom Operators of Bangladesh (AMTOB) yesterday at a pre-budget meeting held at NBR headquarters in the capital.
“The removal of SIM tax will put a positive impact on GDP by enhancing purchasing power of people and thus mobile operators can also contribute further in government exchequer,” they said.
Currently, telecom operators are to pay Tk300 taxes on SIM cards, including Tk109.96 as value added tax (VAT) and Tk190.05 as supplementary duty.
Chief Operating Officer at Robi Axiata Limited Mahtab Uddin Ahmed placed the demand before NBR chairman Md. Ghulam Hussain.
“Bangladesh market has huge potential as voice services is yet to reach to 100% people as the penetration rate is still 68% in the country comparing to 141% in Malaysia and 120% in Thailand,” said Mahtab.
He also requested the NBR to fix a uniform corporate tax rate for the mobile operators, which is now being enjoyed by other corporate companies in various sectors by and large.
As the existing corporate tax rate on mobile operators is the highest in Bangladesh among all the South Asian countries, the investors are staying away for further investment in technology sector, they added.
Currently, listed mobile operators are paying 40% corporate tax while it is 45% for the non-listed companies. The general listed companies are now paying 27.5% tax while non-listed companies are paying 37.5% corporate tax.
The association leaders also demanded withdrawal of the imposed minimum 0.5% tax on gross receipts saying, “It is against the spirit of the related law.”
The other demands include providing SRO benefit for custom duty on import of telecom equipments, authorisation of license fees for telecom operators, VAT exemption on modem at all stages, and exemption of VAT on mobile financial services etc.
In reply NBR chairman Md. Ghulam Hussain said: All these proposals will be thoroughly examined considering their both positive and negative sides.
The meeting was attended, among others, by NBR members Syed Aminul Karim, Barrister Jahangir Hossain, Airtel Bangladesh Chief Finance Officer S K Mukhopadhyay and Robi Axiata Limited managing director and CEO Supun Weerasinghe.