The Africa-focused GSMA event MWC Kigali 2023 is well under way and is proving a useful platform for some major service providers to comment on government policy across the continent – notably on taxation.
In fact six CEOs, representing some of the continent’s biggest operators, have published a communique at the show urging governments to establish new policies to support the positive and inclusive impacts of mobile technology, in order to address investment and usage gaps.
The group included Segun Ogunsanya, Airtel Africa Group; Hassanein Hiridjee, Axian Group; Frehiwot Tamru, Ethio Telecommunications; Ralph Mupita, MTN Group; Jerome Henique, Orange Middle East and Africa; and Shameel Joosub, Vodacom Group.
The communique says: “Reforming fiscal policy will improve affordability for consumers and incentivise investments by operators given that taxes and fees account for 30% of industry revenues according to the GSMA Mobile Tax Policy and Digital Development report.”
It calls for tax rationalisation and targeted fiscal policy reforms that support economic growth and digital development, notably the removal of tax on low-cost smartphones and sector-specific tax.
It also calls for regulatory support to implement the recommendations of the UN Broadband Commission’s 21st Century Financing Models for Bridging Broadband Connectivity Gaps and also climate action policies to improve access to renewable electricity for corporate buyers.
Of course taxation, like power supply, is an ongoing issue and, while some governments are acknowledging the role of mobile operators in boosting development, many, at local, regional and national levels, are still imposing what is, arguably, a high overall tax burden on some operators.
As the CEOs note, the industry currently contributes US$170 billion (8.1%) to GDP across the sub-Saharan region and is committed to spend another US$75 billion, which will yield an expected US$210 billion to sub-Saharan Africa’s GDP by 2030.
But, the CEOs add, further political support, across the continent, is essential to register meaningful progress.
This, they say, includes facilitating the right market structures and conditions to avoid unnecessary fragmentation and policies that support the investment environment needed for success.
