`Tax on digital service contradicts policy’

Bangladesh Mobile Phone Consumers Association today said the government is trying to expedite the digitalisation of the country but they are imposing irrational taxes on service level every year which is contradictory to the telecom and ICT policy of the country.

Different services have been introduced in the country, like ridesharing, and these services have generated huge number of employment, however without considering the overall consequence government increased taxes on it, the association said in a press conference at Dhaka Reporters Unity.

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Wholesale tax increases will hinder the overall digitalisation of the country, said Mohiuddin Ahmed, president of the association.

The government has increased the supplementary duty on overall mobile phone uses to 10 percent from the existing 5 percent and increased the customs duty to 25 percent from the existing 10 percent which will ultimately go against the government’s digitalisation programme, he said.

With this new tax ratio, customers will have to pay 27.77 per cent taxes for the services provided through mobile phones.

Apart from the supplementary duty, mobile phone users are already having to bear 15 per cent VAT and 1 percent surcharge on their bill for phone uses.

Just after placing the budget in the parliament, the National Board of Revenue has issued SRO and mobile phone operators have increased the charges.

“It is easy to collect handsome revenue from the digital industry with less effort and that’s why government took it as one of their cash cows,” said Ahmed.

Finance minister also proposed to raise the minimum tax for mobile companies to 2 per cent of their turnover from 0.75 per cent.

Furthermore, raising the SIM tax from Tk 100 to Tk 200 will double the burden on the industry in adding new connections.

Political leader Jonayed Saki, Poribesh Bachao Andolon (Poba) chairman Abu Naser Khan and others also attended the conference.