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Dhaka Tribune

Zero SIM tax may add Tk10bn to state revenue in 3 years

Update : 09 May 2013, 04:43 AM

If mobile SIM tax is cut to zero, an amount of Tk10.05bn revenue may be added to the government’s exchequer in next three years, said the Association of Mobile Telecom Operators of Bangladesh (AMTOB).

The Association proposed withdrawal of tax on SIM cards. AMTOB already placed their proposal to the National Board of Revenue (NBR) at a talk with NBR Chairman Md Ghulam Hussain in his office recently.

 

NBR members were also present during the meeting as the government is going to announce national budget for the fiscal year 2013-14 next month in the parliament.

AMTOB also demanded duty-free import of SIM and crash cards, said the meeting sources.

Tax was first imposed on selling SIM cards in 2005 during the BNP-led four-party alliance government. The tax was fixed at Tk800 for a SIM card, which has been reduced to Tk600 since 2011.

 “There is no other country in the world paying tax for selling SIM cards. A big amount of money need to be paid as tax only for SIM cards,” said TIM Nurul Kabir, secretary general of AMTOB, to Dhaka Tribune.

According to him, NBR chairman and other members understood the logic of AMTOB’s demand and made promises to do best for the telecom industry.

The AMTOB’s calculation said if SIM card tax is withdrawn, the government may loss Tk54.5bn in next three years. But the government at the same time will earn Tk24.3bn as value added tax, Tk29.2bn as tax, Tk10.5bn from BTRC under revenue sharing and Tk506m from other fields.

During the period, the telecom industry’s earning will also increase by Tk162bn, said the AMTOB estimates.

According to the calculation, if zero tax on SIM cards may increase sales by 23m over the period.

AMTOB said every 2G user currently spend Tk100 only on an average, but once 3G comes, the spending will double.

A high official of a leading mobile operator of the country said, “The calculation is all hypothetical. But it can be true.”

He said the money now being spent to pay SIM tax can be used in the network development. “It will help generate more employment opportunities, which eventually swell revenue earning of the government,” said the official requesting not to be named.

Earlier, the post and telecommunication ministry also proposed withdrawal of SIM tax for to help build Digital Bangladesh.

Zakiul Islam, senior director (legal and corporate division) of Banglalink said, “Considering last five years growth and penetration, we can calculate and find these figures”

“If there is no SIM tax, we will get millions more new subscribers.  This will also add to the government’s income,” said Zakiul Islam, also the former president of AMTOB, to Dhaka Tribune.

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