The government is unlikely to reduce taxes on SIM (Subscribers Identification Module) cards and mobile phone calls with a view to increasing its revenue income, finance ministry officials said.

Besides, the surcharge on personal wealth or assets (movable and immovable) exceeding Tk 20 million will also continue next fiscal alike the outgoing fiscal year.

The official said the revenue earnings of the government from the telecom sector may go down if the National Board of Revenue (NBR) reduces SIM and call rate taxes.

He also said the surcharge on personal wealth or assets will also continue in a bid to increase country’s revenue earnings. The NBR sources said a total 4,567 persons having wealth and properties worth over Tk 20 million gave 10 percent surcharge in the outgoing fiscal, bringing NBR’s income from the segment at Tk 440.62 million.

Recently, the NBR has turned down a proposal of Bangladesh Telecommunication Regulatory Commission (BTRC) to reduce SIM card taxes to less than Tk 500 from existing Tk 600 at a budgetary discussion with finance minister AMA Muhith, Finance Division sources said.

The government may also not reduce the present 15 percent taxes both on call rates and SIM card prices next fiscal. As per NBR statistics, the collection of Value Added Tax (VAT) fell short by Tk 6.0 billion in July-December period of the outgoing fiscal year.

The NBR officials said VAT collection declined in the outgoing fiscal due to reduction of tax on SIM card to Tk 600 from Tk 800 in 2011-12 fiscal year. Last week, country’s mobile phone operators urged the government to reduce SIM card tax in a bid to bringing telecommunication services to the rural segment of people as most of them are deprived of telecom services.

Due to higher taxes on each SIM cards, it is very difficult for the operators to expand their network in the rural areas as their revenue generation is very scanty from the end users, they added.

They also urged the government to bring down the taxes to a reasonable level. As per telecom regulator's data, around 90 million people have been connected with mobile networks till April, 2012.

Chief Communication Officer of Grameenphone, Kazi Monirul Kabir, said: "Government’s revenue earning from the sector will not fall due to the reduction of SIM card taxes, rather it will boost tax revenue due to creation of new subscribers".

The Daily Sun/Bangladesh/ 4th June 2012