No mobile tariff increase: Potraz

via No mobile tariff increase: Potraz – DailyNews Live 14 October 2014 by Kudzai Chawafambira

HARARE – The Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) says Mobile Network Operators (MNOs) must not increase tariffs above approved levels despite government imposing a five percent excise duty on airtime.

Baxton Sirewu, Potraz’s acting director general, told Business Live that “the excise duty will be recovered from the current chargeable rates”.

Potraz currently allows the country’s three wireless network operators — Econet Wireless (Econet), Telecel and state-owned Net*One — to charge a maximum tariff of $0,23 cents per minute on voice.

“For fixed network voice telephony, data and Internet services, Potraz has requested operators to submit new tariff proposals, if necessary, for review and approval to cover the five percent excise duty,” he said.

This effectively means that mobile phone subscribers are likely to bear the brunt of the excise duty by receiving less airtime on voice and data services.

While Econet, the country’s largest MNO with about eight million subscribers, said it could not comment on the issue, Telecel had not responded to e-mailed questions by time of going to print while Net*One’s spokesperson’s mobile was not reachable.

The excise duty on airtime and data offered by mobile operators and other electronic communication networks was with effect from last month.

“To ensure compliance with the excise duty requirement, Potraz has sent out a regulatory circular to all operators advising them on the adjustments to be made on the current tariff structure,” said Sirewu.

He added that Potraz’s expectation is that their “tariff structures will remain competitive in the region as we are not anticipating any major tariff movements to cover the excise duty on airtime and data”.

Sirewu noted that these decisions were arrived at within the context of the pending implementation of results of the recently concluded tariff studies.

As part of efforts to prop up dwindling revenues in the face of swelling expenditure, Finance minister Patrick Chinamasa in his mid-term fiscal review policy last month announced a cocktail of tax measures including fuel and the mobile phone airtime excise duty among others.

Chinamasa admitted that government faced a significant challenge in raising additional revenue to finance non-discretionary expenditures, therefore, he had proposed to levy a five percent excise duty on air time for voice and data, with effect from last month.

The feisty lawyer also said he was proposing a 25 percent customs duty on mobile handsets from October 1 and this has been necessitated by the fact that the previous reductions had helped Zimbabwe’s mobile penetration rate and handset purchases to over 100 percent.

According to Chinamasa, the concession had outlived its usefulness and the Harare administration has also imposed a five cent levy on every mobile money transaction, and in accordance with his 2014 National Budget.