Thursday May 1, 2008

Taxation and the growth of mobile services in sub-Saharan Africa 2008

Person looking at mobile phone smiling, light is reflecting on face in dark room

The GSMA commissioned Frontier Economics to conduct a study into the impact of mobile industry taxation as consumers across sub Saharan Africa face some of the highest mobile-specific taxes world-wide. This report builds on a 2007 GSMA report that examined the impact of air time taxes in East Africa and extends the analysis from air time taxes to those levied on handsets and equipment across the sub continent.

The report quantifies and estimates the mobile industry’s past and future effect on:
– Investment levels
– Tax contributions
– Economic growth
– Coverage and subscriptions

The report then analyses the impact of lowering and removing non-VAT related mobile-specific taxes on subscriptions, usage and the total tax generated by the industry. The report concludes that by removing mobile-specific taxes, mobile ownership and use will rise, stimulating wider economic growth and increasing the total amount of tax produced by the mobile industry in a number of countries.

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