20% Tax Increases Is Too Much

Mobile-PhonesMobile phones distributors have called on government to reconsider its decision to impose a 20 per cent tax increment on the importation of mobile handsets into the country.

These concerns were raised at a public forum organised by eTV Ghana to discuss the impact of the Telecommunication Service and Mobile Handset Tax on consumers. Speaking at the forum, Mr. Joseph Ashiboye of i2 Mobile, a leading Samsung mobile phone distributor in the country, said: “The passing of this new tax into law will do more harm than good to the industry which employs a lot of Ghanaians and contributes significantly  to national revenue. These taxes may actually have the reverse impact as it will encourage the smuggling of mobile phones into the country”.

He said the move would increase the proliferation of fake phones onto the Ghanaian market, since authorised distributors genuinely importing original phones would have to pay so much in taxes, thus leading to increase in prices of original phones.
Present at the conference were other mobile phone distributors who also shared Mr. Ashiboye’s concern.
According to them, the law would go beyond affecting just the distributors and may be detrimental to the entire telecommunication industry.

They explained that, the subscriber base of most telecommunication companies operating in the country is high because consumers are able to afford more than one mobile phone and thus the ability to use more than one network.
Hence, if the law comes into existence, the number of consumers able to afford mobile phones will reduce, and this will impact negatively on the subscriber base of the telecommunication companies which will in-turn have an adverse effect on their revenue, and by extension the nation’s tax purse.

This, they said, would defeat the primary goal of the law which seeks to increase the gov-ernment’s revenue from the sector.
They therefore urged all stakeholders in the industry to support the call for government to rescind its decision on the 20 per cent tax increment on the importation of mobile handsets.

Also present at the forum was the Chief Executive Officer of the Ghana Chamber of Telecommunications, Mr. Kwaku Addo Sakyi-Addo, Mr. Gerald Ankrah of Ghana Independent Broadcasters Association and other stakeholders.

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