Reduce corporate tax rate: AMTOB to NBR

The Association of Mobile Telecom Operators of Bangladesh (AMTOB), the national trade organisation representing all mobile telecom operators in Bangladesh, has proposed to reduce the corporate tax rate on mobile phone operator companies in the  FY2023-2024 budget.

"We propose to remove or reduce the minimum tax. Mobile operators are required to pay a minimum tax of 2% of their annual gross revenue which is in conflict with the Income Tax Act. Paying minimum tax despite loss in business means paying tax out of capital which is a hindrance to business expansion," AMTOB Secretary General Brig Gen (retd) SM Farhad said during the pre-budget discussion meeting with the National Board of Revenue (NBR) on Sunday (12 March). 

AMTOB also proposed to withdraw the minimum turnover tax and abolish the tax of Tk200 imposed on SIM cards.

"There is no alternative to removing or reducing the minimum tax in favor of sustaining the industry and building the Digital Bangladesh as announced by the government," he added. 

During the meeting, SM Farhad presented a 16-point proposal on telecom-related income tax, value-added tax, import duty, and supplementary duty.

Photo: TBS

"The high rate of corporate tax should be reduced. The general corporate tax rate in the country is 27.5% for unlisted companies and 20% to 22.5% for listed companies. However, despite being an essential service, Bangladesh's mobile sector has to pay a high rate of corporate tax. The tax rate is 40% for listed mobile operators and 45% for unlisted companies," he added. 

"In terms of taxation, instead of classifying mobile operators as a separate category, we demand that they be reorganised in line with other companies and that the tax be reduced at that rate," AMTOB secretary general further said. 

He said that the mobile operator sector is one of the sectors that provide the most revenue to the government in Bangladesh.

"We need to remember that the top three operators in the mobile sector are all foreign investors and their contribution to the socioeconomic development of the country is immense. From the main source of people's telecommunication and internet access to banking, mobile money, ride sharing, e-commerce, education, or e-courier, all sectors are directly or indirectly dependent on mobile. As the growth of mobile service providers increases, customers will get better quality services and the government will get more revenue," he added. 

"Even then it is seen that the government is imposing new taxes every year in this sector. If the growth of the mobile sector is not encouraged by rationally considering the taxation system of the mobile sector, it will have an impact on all other sectors," SM Fahad furthered.