Reducing taxes on telecoms goods and services will drive growth, says ICC

  • 28 October 2010

Burdensome and discriminatory taxes unnecessarily stifle the adoption and use of broadband, mobile and other advanced information and communication technology (ICT) sector tools that are major drivers of development and growth in the information-based economy of the 21st century, said ICC today.

In a new discussion paper released today ICC addresses the adverse effects of unnecessarily high taxes on telecommunications services and provides policymakers, businesses and users with practical information about the presence and effects of such tax initiatives. Several countries apply taxes to telecommunications goods and services at higher levels than other goods and services but the ICC paper says that such taxation is not aligned with other national policy goals to drive telecommunications adoption. Indeed, the trend of applying heavy taxes to telecommunications – often to subsidize non-telecommunications initiatives – is increasing, even as countries identify telecommunications adoption as a fundamental goal for all citizens. “Far from being luxury discretionary goods and services, ICTs are the building blocks of opportunity to the global, information-based economy. Increasingly, public policy is oriented towards connecting the unconnected to achieve 100% adoption of advanced telecommunications services. Taxes that impede the goal of universal adoption should be re-evaluated,” ICC said. The paper provides many examples from around the world of the unnecessarily high taxes imposed on telecommunications goods and services. “Reducing discriminatory and unnecessarily high taxes in the telecommunications sector can provide substantial benefits for developed and developing countries alike,” said Eric Loeb, Co-Chair of the ICC task force on Internet and Telecoms Infrastructure and Services. “The information in this paper provides policymakers, businesses and users with concrete information about the concerning trend of tax increases in the telecommunications sector, and examples of how the reduction of such taxes is better aligned with policy goals to foster universal adoption of services for the 21st century information economy.” Click here to view the ICC discussion paper on the adverse effects of discriminatory taxes on telecommunications services