Ministry cautious on ICT taxes
Ministry of Information and Communications Technology says it is cautious to consider waiving taxes on information communication technology (ICT) equipment, a move which if implemented could reduce mobiles services costs
Minister of Information and Communication Technology Henry Mussa said this at the weekend when he visited Airtel Malawi and some private media houses in Lilongwe to appreciate operational issues.
When asked whether government would consider waiving taxes on equipment and other accessories to bring the cost of mobile services down, Mussa, while acknowledging that Internet data charges are high in the country, said waiving taxes on ICT equipment could affect government revenue.
“Taxes help government to develop so the issue of tax is risky. It needs to be looked at in its entirety, not just singling out equipment for service providers but it’s an area that is negotiable between the Ministry of Finance, Economic Planning and Development, Malawi Revenue Authority and service providers. There is the issue to do with the cost of data which is considered quite high. The technocrats have explained to me why data is that expensive.
“Malawi is landlocked. So, to access data, the connection is from the ocean and then here we also have serious challenges that are impacting on the cost of the data. Vandalism, for example, of their fibre, to replace them it’s a huge cost,” he said.
Airtel Malawi managing director Charles Kamoto assured the minister that its recent K30 billion investment on network overhaul will ensure coverage of the whole country as the company keeps on expanding and modernising its network in the next 10 to 15 years.
He said: “Electricity remains a challenge as over 90 of the sites that we rolled out are not connected to the electricity grid.
“The cost is high to operate these on diesel generator, and there is also the issue of vandalism which is huge. The impact of power blackouts in general is huge on us because we are spending 2 000 litres of fuel a month on fuel to support diesel generators,” said Kamoto.
Mussa also challenged the private media to make significant investments if they are to reap on opportunities that are available in the country.
However, Zodiak Broadcasting Station managing director Gospel Kazako said there are many foreign companies that are given duty-free status on some of their investments “but why not us yet we are Malawians creating employment”.
Recently, the ICT Association of Malawi has also been advocating for tax waiver on ICT with an argument that high taxes are contributing towards low penetration of ICT services in the country.
