VAT cut on SIM suggested

The Ministry of Posts and Telecommunications and Bangladesh Telecommunication Regulatory Commission (BTRC) have suggested reducing the Value Added Tax (VAT) on the price of mobile-phone SIM cards from Tk 600 to Tk 200.

Cell-phone operators have long been demanding a cut.
The recommendation has been sent to the Ministry of Finance for a reduction in the next budget for the 2013-14 financial year.

Telecom Secretary Md Abubakar Siddique told : “A meeting of the ministry a few days ago discussed reducing the Value Added Tax on the price of SIM cards and several other issues for the upcoming budget.”

The recommendations were sent to the Ministry of Finance after that meeting, a high-level ministry official told .

The official said, “Though the major operators are able to pay the VAT on the price of SIM cards, it has toughened the situation for the operators with low number of users. The ministry has made the recommendation considering their situation.”

Currently, the operators pay Tk 600 VAT against each SIM card without charging the users, which means they have to pay subsidy.

Following repeated demands from the operators, the VAT was slashed to Tk 600 from Tk 800 on each SIM card in the 2011-12 fiscal year.

Currently, Grameenphone, Banglalink, Robi, Airtel, Citycell and state-run operator TeleTalk are providing mobile phone service in Bangladesh.

According to BTRC, there are at least 100 million mobile phone users in the country.