Government reconsiders controversial tax hike

4 Feb 2014

The Jordanian government is still studying the impact of the decision to double the tax on mobile subscriptions to 24% and is looking into the consequences for consumers as well as its effect on operator revenues. The Economic Development Committee of the cabinet is currently discussing the effects of the tax hike, which came into force in mid-2013, and is expected to reduce the levy slightly, The Jordan Times cites an unnamed industry insider as saying. The nation’s three wireless providers Zain, Orange and Umniah, as well as lobby group the ICT Association of Jordan (ICT@J) have called on the state to rescind the tax increase. Ihab Hinnawi, the CEO of Umniah claimed that revenues in the telecom sector have fallen by 9% since the tax was introduced, adding that profits for cellcos had fallen by 30%-40% over the same period. ICT Minister Azzam Sleit told press that the committee was considering a solution that would reach a balance that would be acceptable for the public, providers and the state. However, Sleit added that the government was not looking to take any action regarding the doubling of the tax on mobile phones from 8% to 16%, which was introduced at the same time as the increased tax on services.

According to TeleGeography’s GlobalComms Database, Jordan’s trio of wireless providers boycotted the recent spectrum auction for 4G-compatible frequencies in protest against the tax increase.



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