Telecoms want smartphone taxes scrapped
Kampala- Telecom companies have appealed to the government to scrap the 18 per cent tax levied on smartphones to make them affordable to the rural poor.
The companies say they have invested in infrastructure across the country but the uptake of their innovations remains low because fewer subscribers have access to smartphones.
The government currently charges 18 per cent Value Added Tax on smartphones and 12 per cent excise duty.
Telecom companies’ representatives during a closed door meeting to discuss Uganda’s mobile technology held in Kampala yesterday complained that the high taxes make smartphones prices prohibitive for majority of Ugandans.
Investing in telecommunication
The MTN Uganda acting chief executive officer, Mr Gordian Kyomukama, confirmed the meeting details and said they have invested heavily in rolling out expensive network upgrades which are not being properly utilised.
“We recognised that and we saw an opportunity to provide in a much cheaper way to deliver internet to the people. I think as a region, we need to sit down and see how we can bring these costs down,” he said.
Ms Enid Edroma, the MTN general manager, corporate affairs, said government needs to work out a better tax regime if access to better network is to be realised by the users.
“If we are putting expensive phones outside there and you levy a tax, they become more expensive. We want them rationalised as we seek for solutions that will bring down the costs,” Ms Edroma said.
Airtel Uganda was yet to respond to our official calls. However, a source, who spoke on condition of anonymity because he is not authorised to speak on behalf of the company, said government needs to speed up the process of securing locally manufactured smartphones in the country, in addition to abolishing taxes on the importation of mobile phones.
Government responds
The ICT ministry officials say they are engaging the Finance ministry to sort out the problems.
Mr Charles Auk Lwanga, the assistant commissioner for telecoms, said the taxes on mobile phones are counterproductive and government needs to make them more affordable.
“As ICT sector, we are trying to put the case across. We are going to link up with other departments and make it apparent that as a country, it is counterproductive to burden the ICT sector with so much taxes and yet it is an enabling sector,” Mr Lwanga said.
Officials from the Finance ministry were unavailable to explain why the taxes have remained high despite the past commitments by the government to scrap off the taxes on mobile phones.
