In the proposed budget, supplementary duty on talk time and data use have been increased from 5% to 10%
Mobile phone operators have urged the government to withdraw all taxes on mobile talk time and data use, subscriber identity module (SIM) card and yearly turnover from the proposed budget for 2019-20 fiscal year.
The Association of Mobile Telecommunication Operators of Bangladesh (AMTOB) made the call at a post-budget briefing in the capital on Tuesday.
In the proposed budget, supplementary duty on talk time and data use have been increased from 5% to 10%, SIM tax from Tk100 to Tk200 and imposed fresh 15% tax on retained earnings for listed companies.
In addition, the draft budget has increased minimum tax for mobile companies from 0.75% to 2% of turnover and import duty on smart phones from 10% to 25%.
“We are utterly disappointed that the proposed national budget has undermined the significant contribution made by the telecom industry in implementing the vision of Digital Bangladesh,” said AMTOB Secretary General Brig Gen SM Farhad (Retd).
Telecom industry contributed over 6.2% to the gross domestic product (GDP) but there was no reflection of this in the proposed budget, he said.
The rise in minimum tax threatened to make 4G expansion and the required investment for upcoming 5G in Bangladesh uncertain, AMTOM added.
The proposal to raise supplementary duty from 5% to 10% would only add to the burden of all the aspiring citizens of Digital Bangladesh, while raising of the SIM tax from Tk100 to Tk200 would double the burden on new connections and SIM replacement, said Robi Chief Corporate Officer Taimur Rahamn.
He added: “The industry is in the process of connecting the underprivileged segment of society to Digital Bangladesh, so slapping this additional supplementary duty and doubling the SIM tax will only stall the progress in attaining the Sustainable Development Goals.”
Furthermore, imposition of 15% tax on retained earnings would have adverse implications on publically listed companies , he added.
Tax on retained earnings would be double taxation, as listed companies already paid up to 42.5% corporate tax and the new law would be an additional 15% tax on its year end reserves, he said further.
AMTOB expressed its hopes that the government would reconsider the budget proposal in favour of the industry, which was at the cusp of the 4th industrial revolution and would require massive investment going forward.