Mobile operators query Tanzania Sim tax

Wednesday, 17 July 2013 07:03 Kenan Kalagho, EAST AFRICAN BUSINESS WEEK, KAMPALA, UGANDA

DAR ES SALAAM, TANZANIA - The Tanzania government may lose a huge sum in tax revenues following disagreements with mobile phone network operators over the recently imposed monthly tax of Tsh1,000 ( about $0.62) on every SIM card.
This was proposed in last month’s budget proposals for 2013/2014.
In a recent advertisement in the local newspapers, the Mobile Association of Tanzania (MOAT), argued that the tax will have a negative impact in denying on poor Tanzanians by limiting access to telecom services.
MOAT thinks the income status of mobile users has not been considered by the government considering that both the high and lower income customers will be charged at the same rate
In a recent statement availed to the media, MOAT argues that it was unfortunate for the government to introduce such a fee at a time when mobile telecom companies are striving to reach the rural areas. They said this is likely to slow rural penetration.
However the government counters that the $0.62 tax is very small and unlikely to cause any harm to local mobile users in the country.
In a press statement availed to East African Business Week recently, the government claims to have been losing considerable revenues from mobile phone operators and this tax imposition has been instituted at the right time.
It said that both the research and consultations had been made prior to introducing the said fee, saying much of the revenue to be generated through mobile phone operators would be channeled into the education sector.
The MOAT says currently only 22 million users in Tanzania were connected to mobile networks out of the population of 45 million.