Increased Costs for SIM-Dependent Mobile Services

The proposed national budget

The proposed national budget

The proposed national budget for the fiscal year 2024-2025 in Bangladesh has sparked concerns among mobile phone users and telecom operators alike, as the government plans to increase taxes on SIM-based mobile services. Finance Minister Abul Hasan Mahmud Ali presented the budget in the National Parliament, outlining changes that are poised to impact telecommunication services in the country.

Key Proposals

The Finance Minister proposed raising the supplementary duty on SIM-based mobile services from 15 percent to 20 percent. Additionally, the value-added tax (VAT) on each SIM or e-SIM card is set to increase from Tk 200 to Tk 300. These amendments are expected to lead to an increase in the cost of mobile calls, affecting consumers' purchasing power and usage patterns.

Impact on Consumers and Industry

The proposed tariff adjustments have raised concerns among stakeholders, particularly the Association of Mobile Telecom Operators of Bangladesh (AMTOB). They fear that the higher taxes will exacerbate financial burdens on mobile users, especially marginalized communities, potentially leading to a decline in mobile service usage. Furthermore, the increased VAT on SIM cards may deter new users, hindering the growth of mobile connectivity in a country where a significant portion of the population remains unconnected.

Call for Reconsideration

In response to these concerns, AMTOB has urged the government to reconsider its decision and collaborate with the telecom industry to devise a more sustainable approach. They emphasize the importance of aligning taxation policies with the government's vision of a digitally inclusive Bangladesh and stress the potential negative implications on GDP growth and overall digitization efforts.

The proposed increase in taxes on SIM-based mobile services in Bangladesh's national budget has ignited debates surrounding its potential impact on consumers and the telecom industry. As stakeholders voice their concerns, calls for a reevaluation of these proposals resonate, underscoring the need for a balanced approach that fosters continued growth and accessibility in telecommunications.

This report encapsulates the implications of the proposed tax adjustments on SIM-based mobile services in Bangladesh, highlighting concerns raised by stakeholders and calls for government reconsideration to ensure sustainable growth in the telecom sector.

   


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