News Feed Item
GSMA Calls for Re-Evaluation and Reduction of Mobile-Specific Taxation across Sub-Saharan Africa
|By Business Wire
|September 1, 2014 04:00 AM EDT
The GSMA today called upon governments in Sub-Saharan Africa (SSA) to
review their approach to the increasing tax burden imposed on the mobile
industry. The GSMA released two studies that explore various aspects of
mobile-specific taxation in Africa and show that this burden is stifling
economic growth in those countries that have introduced mobile-specific
taxation. The first report, ‘Surtax on International Incoming Traffic
(SIIT) in Africa’, examines the impact of SIIT in Sub-Saharan Africa
and concludes that the introduction of SIIT can lead to less revenue for
mobile operators and governments and higher prices for consumers. A
second report, ‘Sub-Saharan Africa Universal Service Fund (USF) Study’,
found that most of these funds are not succeeding in delivering their
stated goal of widening access to telecommunication services and that
alternative market-based solutions are more effective.
“Sub-Saharan Africa is the fastest-growing region globally, with 328
million unique mobile subscribers and an annual growth rate of 18 per
cent over the last five years. However, with subscriber penetration of
just 37 per cent, there is clearly still huge potential for greater
growth ahead,” said Tom Phillips, Chief Regulatory Officer, GSMA.
“Beyond further adoption of basic voice services, the region is starting
to see an explosion in the uptake of mobile data. However, a short-term
focus by some countries on generating revenue through increasing the
SIIT, combined with the continued imposition of USF levies despite
accumulated funds that are not being effectively employed, will clearly
have a negative impact on the domestic mobile sector and other
businesses in the region.”
Report Highlights Negative Economic Impact of SIIT in Africa
The report Surtax on International Incoming Traffic (SIIT) in Africa
studies the effects of the SIIT in six countries in Sub-Saharan Africa
and on regional integration. The report’s findings are in line with a
recent publication from the Organisation for Economic Co-operation and
Development (OECD)1 that shows that imposing higher charges
for the termination of international inbound traffic suppresses demand.
Similar to the GSMA’s study, the OECD report concludes that those
governments that impose higher termination charges do not see their
revenues increase proportionately. The report outlines the impact for
consumers, governments and businesses:
Consumers - SIIT effectively fixes prices for international
traffic termination and in these countries where it is imposed, the
SIIT has caused the price of terminating international incoming calls
to increase by an average 97 per cent, with an increase of up to 247
per cent in Burundi;
Governments - SIIT has already shown its potential to create
economic losses to governments that impose it. The report estimates
that, in the absence of the SIIT, mobile operators could have
terminated an extra 1.2 billion international minutes and generating
$86 million in revenues from June 2010 to March 2014, indicating that
governments could have gained an extra $27.5 million across the period
had the SIIT not been introduced; and
Businesses - SIIT creates significant extra costs to African
businesses that trade with, and therefore call, businesses in
countries where the SIIT has been imposed, negatively affecting
regional integration. Evidence from mobile operators indicates that
nearly 40 per cent of all international incoming traffic is from
countries in the region, and in some countries, such as Tanzania, over
50 per cent of calls originate within Africa.
USF Report Highlights Need For Alternative Methods to Achieve
The Sub-Saharan Africa Universal Service Fund Study finds that USFs in
the region do not appear to be the most appropriate mechanism for
providing universal access and service, and to furthering social and
economic improvement in a proactive, cost-effective and transparent
manner. Generally, the report found significant deficiencies in fund
structure, management and operation throughout the SSA region. The
report concludes that consideration must be given to disbanding inactive
funds and returning the remaining monies to the operators who paid the
levies in the first place and, where this is not feasible, gradually
reducing the levy collected for either inactive or low activity funds
and gradually phasing out the funds. The study found that alternative
approaches to achieving universal service, such as license obligations,
are often more effective than USFs.
Both reports have identified countries within the region that have
recognised the negative impact of both the SIIT and USFs on trade and
regional integration. The two studies conclude that in light of these
negative consequences, other governments should re-consider the SIIT and
USF and assess the specific impact on their economies and on economic
development for the region as a whole.
“Mobile is an important contributor to the economy of Sub-Saharan
Africa, accounting for more than six per cent of the region’s GDP, more
than any other comparable region globally,” continued Phillips. “As our
research has shown, taxation as a proportion of the total cost of mobile
ownership in the region is also higher than the global average, a factor
that makes mobile services less affordable for end users. The SIIT is
clearly being used as an opportunistic short-term revenue tool by some
governments and, in reality, USFs have become an unnecessary levy on the
telecommunications industry. We strongly feel that eliminating harmful
mobile-specific taxation would benefit consumers, businesses and
governments by encouraging the take-up of new mobile services, improving
productivity and boosting GDP and overall tax revenues in the longer
Notes to Editors
OECD (2014), "International Traffic Termination", OECD
Digital Economy Papers, No. 238, OECD Publishing 10.1787/5jz2m5mnlvkc-en.
The GSMA reports can be found at: www.gsma.com/publicpolicy/tax/research-and-resources
About the GSMA
The GSMA represents the interests of mobile operators
worldwide. Spanning more than 220 countries, the GSMA unites nearly 800
of the world’s mobile operators with 250 companies in the broader mobile
ecosystem, including handset and device makers, software companies,
equipment providers and Internet companies, as well as organisations in
industry sectors such as financial services, healthcare, media,
transport and utilities. The GSMA also produces industry-leading events
such as Mobile World Congress and Mobile Asia Expo.
For more information, please visit the GSMA corporate website at www.gsma.com.
Follow the GSMA on Twitter: @GSMA.
In his session at @ThingsExpo, Chris Klein, CEO and Co-founder of Rachio, will discuss next generation communities that are using IoT to create more sustainable, intelligent communities.
One example is Sterling Ranch, a 10,000 home development that – with the help of Siemens – will integrate IoT technology into the community to provide residents with energy and water savings as well as intelligent security. Everything from stop lights to sprinkler systems to building infrastructures will run ef...
Apr. 30, 2016 05:30 PM EDT Reads: 677
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data.
In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
Apr. 30, 2016 04:45 PM EDT Reads: 544
Whether your IoT service is connecting cars, homes, appliances, wearable, cameras or other devices, one question hangs in the balance – how do you actually make money from this service? The ability to turn your IoT service into profit requires the ability to create a monetization strategy that is flexible, scalable and working for you in real-time. It must be a transparent, smoothly implemented strategy that all stakeholders – from customers to the board – will be able to understand and comprehe...
Apr. 30, 2016 04:45 PM EDT Reads: 1,040
SYS-CON Events announced today that Peak 10, Inc., a national IT infrastructure and cloud services provider, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY.
Peak 10 provides reliable, tailored data center and network services, cloud and managed services. Its solutions are designed to scale and adapt to customers’ changing business needs, enabling them to lower costs, improve performance and focus inter...
Apr. 30, 2016 04:45 PM EDT Reads: 977
In the world of DevOps there are ‘known good practices’ – aka ‘patterns’ – and ‘known bad practices’ – aka ‘anti-patterns.' Many of these patterns and anti-patterns have been developed from real world experience, especially by the early adopters of DevOps theory; but many are more feasible in theory than in practice, especially for more recent entrants to the DevOps scene.
In this power panel at @DevOpsSummit at 18th Cloud Expo, moderated by DevOps Conference Chair Andi Mann, panelists will dis...
Apr. 30, 2016 04:15 PM EDT Reads: 535
See storage differently! Storage performance problems have only gotten worse and harder to solve as applications have become largely virtualized and moved to a cloud-based infrastructure. Storage performance in a virtualized environment is not just about IOPS, it is about how well that potential performance is guaranteed to individual VMs for these apps as the number of VMs keep going up real time.
In his session at 18th Cloud Expo, Dhiraj Sehgal, in product and marketing at Tintri, will discu...
Apr. 30, 2016 04:15 PM EDT Reads: 729
So, you bought into the current machine learning craze and went on to collect millions/billions of records from this promising new data source. Now, what do you do with them? Too often, the abundance of data quickly turns into an abundance of problems. How do you extract that "magic essence" from your data without falling into the common pitfalls?
In her session at @ThingsExpo, Natalia Ponomareva, Software Engineer at Google, will provide tips on how to be successful in large scale machine lear...
Apr. 30, 2016 04:15 PM EDT Reads: 1,023
Machine Learning helps make complex systems more efficient. By applying advanced Machine Learning techniques such as Cognitive Fingerprinting, wind project operators can utilize these tools to learn from collected data, detect regular patterns, and optimize their own operations. In his session at 18th Cloud Expo, Stuart Gillen, Director of Business Development at SparkCognition, will discuss how research has demonstrated the value of Machine Learning in delivering next generation analytics to im...
Apr. 30, 2016 04:15 PM EDT Reads: 1,659
Unless you don’t use the internet, don’t live in California, or haven’t been paying attention to the recent news… you should be aware that self-driving cars are on their way to becoming a reality. I have seen them – they are real.
If you believe in the future reality of self-driving cars, then continue reading on. If you don’t believe in the future possibilities, then I am not sure what to do to convince you other than discuss the very real changes that will roll out with the consumer producti...
Apr. 30, 2016 04:00 PM EDT Reads: 531
Up until last year, enterprises that were looking into cloud services usually undertook a long-term pilot with one of the large cloud providers, running test and dev workloads in the cloud. With cloud’s transition to mainstream adoption in 2015, and with enterprises migrating more and more workloads into the cloud and in between public and private environments, the single-provider approach must be revisited.
In his session at 18th Cloud Expo, Yoav Mor, multi-cloud solution evangelist at Cloudy...
Apr. 30, 2016 03:30 PM EDT Reads: 1,431
There is an ever-growing explosion of new devices that are connected to the Internet using “cloud” solutions. This rapid growth is creating a massive new demand for efficient access to data. And it’s not just about connecting to that data anymore.
This new demand is bringing new issues and challenges and it is important for companies to scale for the coming growth. And with that scaling comes the need for greater security, gathering and data analysis, storage, connectivity and, of course, the...
Apr. 30, 2016 03:15 PM EDT Reads: 709
This is not a small hotel event. It is also not a big vendor party where politicians and entertainers are more important than real content.
This is Cloud Expo, the world's longest-running conference and exhibition focused on Cloud Computing and all that it entails.
If you want serious presentations and valuable insight about Cloud Computing for three straight days, then register now for Cloud Expo.
Apr. 30, 2016 02:30 PM EDT Reads: 1,698
IoT device adoption is growing at staggering rates, and with it comes opportunity for developers to meet consumer demand for an ever more connected world. Wireless communication is the key part of the encompassing components of any IoT device. Wireless connectivity enhances the device utility at the expense of ease of use and deployment challenges. Since connectivity is fundamental for IoT device development, engineers must understand how to overcome the hurdles inherent in incorporating multipl...
Apr. 30, 2016 02:15 PM EDT Reads: 1,442
Redis is not only the fastest database, but it has become the most popular among the new wave of applications running in containers. Redis speeds up just about every data interaction between your users or operational systems.
In his session at 18th Cloud Expo, Dave Nielsen, Developer Relations at Redis Labs, will shares the functions and data structures used to solve everyday use cases that are driving Redis' popularity.
Apr. 30, 2016 02:00 PM EDT Reads: 1,070
SYS-CON Events announced today that Stratoscale, the software company developing the next generation data center operating system, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY.
Stratoscale is revolutionizing the data center with a zero-to-cloud-in-minutes solution. With Stratoscale’s hardware-agnostic, Software Defined Data Center (SDDC) solution to store everything, run anything and scale everywhere...
Apr. 30, 2016 01:15 PM EDT Reads: 1,519