Taxation and the Growth of Mobile in East Africa 2007
East Africans currently pay taxes of between 25% and 30% on mobile phone services, compared with an average of 17% across Africa.
Our report
A GSMA report, ‘Taxation and the Growth of Mobile in East Africa’ has found that, if the governments in Uganda, Tanzania and Kenya were to cut mobile taxes today, their total tax receipts would actually rise in the medium to long term.
This is because a cut in mobile services taxes would lead to a reduction in tariffs, which would then boost usage of mobile services. Greater usage of mobile phones improves communication between businesses and their customers, fuelling economic development and lifting tax receipts from across the wider economy.
Analysing impact
The study quantified the economic contribution of the mobile industry in East Africa and analysed the impact of lowering excise duties in Kenya, Tanzania and Uganda and the potential impact of introducing excise duty in Rwanda.
Encouraging governments
In many developing markets, including Thailand, Bangladesh and Pakistan, governments have lowered or removed mobile-specific taxes, to the benefit of consumers, private enterprise and governments. The GSMA encourages governments in East Africa to do likewise, as the indirect benefits to the economy of having affordable access to telecom services far outweigh any short-term benefit to the budget.
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