Chamber hints rising cost of telecoms services in Ghana on Bill amendment

The cost of telecoms services could rise if the Communication Service Tax (CST) Amendment Bill currently before parliament is passed, says the Ghana Telecoms Chamber.

The bill imposes a 6% tax in addition to the existing surcharge of six cents per minute which government collects on international calls.

“If parliament passes the CST Amendment Bill it would lead to a substantial increase in the cost of telecommunications services, if operators pass on the cost to consumers,” the Chamber said in a statement July 3, 2013.

According to the statement, mobile network operators already pay to government 15% VAT and NHIL on incoming international calls.

According to the Chamber, if mobile operators absorb the new taxes, “it would make it difficult for them to justify the large investments required to expand infrastructure to meet the fast-growing demand for telecoms services, particularly data.”

The Chamber disclosed that the Finance Ministry is considering a further 5% Stabilization Levy on telecommunications services which is the only sector that has maintained almost zero inflation in the Ghanaian economy consistently for more than 36 months despite rising inflation in other sectors.

The CST or Talk Tax was introduced as a Consumption Tax in 2008 to raise revenues for government from subscribers by taxing them six per cent on the value of services used.

By Ekow Quandzie