Tax on sim-cards

The high cost of sim-cards will cause the mobile phones to stay out of reach for much of the population. With the previous cost of sims as little as Tk 200, this used to give more people the opportunity to enter the market.

Access to this technology can change people's lives and open up many avenues of advantage to them. The government should be supporting this access, not shutting it down. The more low and middle-income people have access to this technology, the better they will be able to compete in the economic market-place, with spill-over benefits to the economy as a whole.

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In terms of revenue generated, the government also seems to have miscalculated. The government reaps 15 percent VAT on each phone card sold and phone call made, and so stand to gain immensely from the expansion of the market. Almost every other country in the world has moved to a low sim-card cost strategy, both to expand the industry and also to generate revenue.

Indeed, the proposal is likely to have a tectonic effect on the industry as a whole, and might lead the affected companies to completely re-evaluate their business models, with negative impact on the industry and the wider economy almost guaranteed.

We urge the government to not include this tax in the final budget. The proposed tax is a regressive one whichever way one looks at it and should therefore be done away with considering the far-reaching negative consequences it would have for the industry which employs thousands and for the millions of potential consumers who would thus be denied access to a mobile phone.