Telcos want tax to be rationalised

The country’s telecom operators have urged the government to rationalise the tax regime for the fiscal year 2021-22 to help it contribute more to building Digital Bangladesh.

Reacting to the proposed budget for FY22, the Association of Mobile Telecom Operators of Bangladesh (AMTOB) made the call.

In the proposed budget, the government has kept taxes for the sector unchanged. 

The telecom sector had been appealing for reform in applicable tax policies for the last few years, but it was ignored, said the organisation in a statement expressing its frustration.

“Unfortunately, none of our well-reasoned passionate pleas for the telecom sector has been reflected in the proposed budget. Therefore, the industry will continue to struggle in the coming year resulting in a slower digitalization drive at a time when we needed to accelerate it," AMTOB President Mahtab Uddin Ahmed said.

AMTOB had been demanding for withdrawal or rationalise the minimum two per cent turnover tax imposed on the unprofitable carriers.

It also demanded a reduction of corporate tax to a tolerable level on non-listed and listed operators to 32.5 per cent and 25 per cent, respectively. The corporate tax is currently 40 per cent for listed telcos and 45 per cent for non-listed telcos.

The association of mobile operators also demanded a reduction of the existing 33.25 per cent and 21.75 per cent VAT, SD, and surcharge over Tk 100 talk time and internet usage to a reasonable level.

They also demanded the withdrawal of supplementary duty and surcharge from Direct Operator billing and the abolishment of Tk 200 as tax imposed on mobile SIM.

AMTOB also demanded to provide them with amortization facilities, an accounting technique used to periodically lower the book value of a loan or intangible asset over a certain time.

It also sought a clear guideline for VAT exemption for government agencies and demanded rationalising interest on unpaid VAT.

Brig Gen (retd) SM Farhad, the general secretary of AMTOB told The Business Post that they were making the demands for years but it fell into deaf ears.

“We placed the demands to National Board of Revenue (NBR) repeatedly but they paid no attention to us,” he said.