Ghana set to abolish mobile phone tax

The Alliance for Affordable Internet (A4AI) has welcomed Ghana’s commitment to abolish pricey import duties on smartphones.

The Ghanian government has announced these first steps in a drive to enable affordable internet access through policy reform. A4AI said the step, confirmed in the 2015 Budget presented, was a key recommendation developed by A4AI-Ghana Multi-stakeholder coalition established earlier this year.

Proposals to remove this duty were recommended by the A4AI Ghana Coalition Working Group on Taxation, led by Kwaku Saakyi-Addo, CEO of Telecoms Chamber.

According to Telecompaper, the elimination of the 20 percent import duty will essentially reduce the cost of handsets in Ghana, where taxes make up approximately 35 percent of the cost of a smartphone. It is expected that the increase in smartphone penetration, following the lower taxes, will increase revenue from Communication Service Tax, VAT and corporate taxes.

In a statement to media the government revealed that: “Communication is shifting from voice to data and mobile data is projected to grow 6.3 times between 2013 and 2018. It is being proposed that in order to increase smartphone penetration, and in line with Government’s policy of bridging the digital divide within the country, import duties on smartphones will be essentially removed. It is expected that the increase in smartphone penetration will increase revenue from Communication Service Tax, VAT and corporate taxes.” By removing taxation, according to Sonia Jorge Executive Director of the Alliance for Affordable Internet, this will be the first step to get Ghanian citizens online.