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Corporate - Technology - June 9, 2021

Telecos demand review of taxation in budget

Industry Desk: Association of Mobile Telecom Operators of Bangladesh (AMTOB) yesterday made appeal to the government for reconsidering the proposed taxation in the national budget in telecom industry considering their recommendations.
Elaborating on the predicaments being faced by the telecom industry, AMTOB Secretary General Brig Gen S M Farhad (Retd.) in a virtual post-budget press briefing said the government can easily catalyze GDP growth by lowering the taxation structure.
He said despite the expansion of mobile coverage, about half of Bangladesh’s population (46 percent unique-subscriber penetration) remains unconnected to the mobile network.
“Reforming mobile taxation is therefore a key to accelerating digital inclusion,” he said.
According to the International Telecommunication Union (ITU), 10 percent increase in mobile broadband penetration would yield 2.43 percent increase in GDP per capita in the developing countries.
AMTOB sought withdrawal or rationalization of the minimum 2 percent turnover tax imposed on the unprofitable carriers.
Besides, rationalization of the current high corporate tax rate and its reduction to a tolerable level on non-listed and listed operators to 32.5 percent and 25 percent, respectively (current 40 percent for listed and 45 percent for non-listed) also demanded by it.
AMTOB also demanded withdrawal of supplementary duty and surcharge from direct operator billing, amortization facilities on all intangible assets, abolishment of SIM tax of Tk 200, reduction of existing 33.25 percent and 21.75 percent VAT, SD and surcharge to a reasonable level and clear guidelines for VAT exemption.
Banglalink’s Chief Corporate and Regulatory Affairs Officer Taimur Rahman said “If the tax rates are reduced significantly, our investors will feel more encouraged investing in this telecom market, which is a good sign from the FDI perspective as well.”
“We are still hopeful that the authorities will make a taxation regime which is conducive to providing quality digital services to customers at affordable prices,” he added. Grameenphone’s Director and Head of Public and Regulatory Affairs Hossain Sadat said “We believe, rationalizing the taxation systems will accelerate the digital journey and will help us to contribute more towards the national exchequer.”
Robi’s Chief Corporate and Regulatory Officer Shahed Alam said “Despite making our demands based on thorough analysis, we, as an industry, are continuing to get deprived of the budget every year.”
“We urge the government to undertake a comprehensive study on the taxation structure for the industry so we would have a healthy dialogue and arrive at decisions that will truly unlock the Digital potential of the country,” he added.

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