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Association of Mobile Telecom Operators of Bangladesh on Friday termed the hike in taxes on the mobile phone companies and telecommunication services as unjust and ruinous for the sector and sought a reversal of the move.
In a statement issued by AMTOB secretary general SM Farhad, the association gave the reaction to the budget proposed for the fiscal year 2019-20 where taxes on the mobile phone companies and on their customers’ phone usage were hiked.
Finance minister AHM Mustafa Kamal placed the budget before parliament on Thursday.
As per the latest government data, people are using 16.06 crore connections of the mobile phone operators. Of them, 9.37 crore connections are being used for internet services.
‘We are deeply saddened to note that the proposed national budget undermines the significant contribution made by the telecom industry to implementing the vision of Digital Bangladesh,’ the association said.
It is widely recognised that the telecom sector in Bangladesh is saddled with the highest tax burden in the world, said AMTOB, adding that the industry experts as well as the policymakers had repeatedly raised alarm bells regarding the industry’s sustainability given the tax burden.
The damaging impact of this tax burden has resulted in three operators out of the total four at the moment languishing in losses for years, it said.
In this backdrop, the imposition of minimum tax of 0.75 per cent of turnover so far meant that the investors of the three operators were forced to pay 0.75 per cent of their revenue even though they were making losses, it said.
‘We are in utter dismay to find that this unjust tax has been proposed to be raised to 2 per cent of turnover from 0.75 per cent,’ said the association of mobile telecom operators.
Instead of lending a hand to the vital industry, the government has decided to add to the backbreaking tax structure, said Farhad in the statement.
‘We feel disheartened and completely heartbroken at this suicidal decision,’ he said.
‘On the other hand, proposal to raise supplementary duty from 5 per cent to 10 per cent will only add to the burden for all the aspiring citizens of Digital Bangladesh.’
Furthermore, raising the SIM tax from Tk 100 to Tk 200 would double the burden on the industry in adding new connection, the association said.
Slapping taxes on the industry would stall progress in attaining sustainable development goals, it said.
The association hoped that the government would reverse its proposals in favour of the industry.
It mentioned that the fourth industrial revolution powered by 5G, internet of things, artificial intelligence would require massive investment.
‘In order to deliver this dream to all the people of the country, the telecom industry’s health needs to be ensured for the nation’s interest,’ said AMTOB.
‘Therefore, we are making the most ardent appeal possible to not just reverse the proposals for the sectors but to infuse a fresh thinking on taxation to ensure that the energy, vitality and the agility of the telecom sector can be fully utilised,’ it said.
Apart from increasing turnover taxes, SIM tax and supplementary duty on usage, the government in the proposed budget also raised import duty on smartphone to 25 per cent from the existing 10 per cent.
source (NA)
