Telecoms Chamber outraged at new tax
The Ghana Chamber of Telecommunications has expressed outrage at attempts by the government to introduce what it describes as an additional tax on telecom service providers in the country, a move it says could negatively impact the quest of players in the industry to continuously invest in infrastructure development.
The chamber, made up of players in the mobile telecom industry in the country, argued that the sector was the only utility service provider overburdened with taxes and indicated that additional taxes could adversely affect investments that would ensure the provision of continuous quality services for consumers.
“The Ghana Chamber of Telecommunications is gravely dissatisfied with the Communications Service Tax (CST) Amendment Bill currently before Parliament under a certificate of urgency,” the Chief Executive Officer of the chamber, Mr Kweku Sakyi-Addo, told the Daily Graphic in an interview in Accra.
According to him, network operators absorbed the VAT and NHIL on international traffic because there was no opportunity to recover them as inut tax.
Last Friday, the government introduced a bill seeking an amendment to the CST which, when passed, will compel telecom operators to pay a six per cent tax on interconnection charges.
“Already, the network operators absorb the VAT/NHIL on international traffic because there is no opportunity to recover them as input tax,” Mr Sakyi-Addo said.
He noted again that following Cabinet’s approval, the Ministry of Finance was considering a further five per cent stabilisation levy on telecommunication services.
He noted that since the introduction of the CST in 2008, telecom companies had been absorbing the cost without passing it on to consumers because of the competition.
He recalled that in the implementation of the CST, the Ghana Revenue Authority (GRA) interpreted the law to include interconnection fees which were fixed by the regulator and charged by operators on one another for off-net services.
“When strenuous efforts to address this through consultations failed, the matter went to court where a judgment was given in favour of the mobile operators’ interpretation in April 13, 2013,” he said.
Mr Sakyi-Addo, therefore, noted that the memorandum to the CST Amendment Bill, which stated that “the tax was intended as an excise tax to raise additional revenue from communications services rendered by mobile operators to their customers and to each other”, did not reflect the facts as proven by the court’s decision and, indeed, by the records in Parliament.
He noted that for a sector that was considered so essential that operators were fined when their services fell short, it could be counter-productive to tax it like a luxury service.
By Charles Benoni Okine/Daily Graphic/Ghana