Jordan - telecommunications tax

Operators' concern over Jordan telecom tax

Mobile operators in Jordan have criticised a proposal to tax mobile phone use as being ill-planned and potentially damaging to the sector, after the lower house of the country’s parliament, the house of deputies, endorsed a decision to impose a 1-fils tax per minute on mobile phone calls, with the revenues earmarked to help the country’s livestock industry.

But operators and industry analysts said that the planned tax of D0.01 ($0.014) per minute on wireless calls would cause headaches for cash-strapped mobile users and mobile operators already hit by numerous taxes.

Philippe Vogeleer, chief strategy officer at Jordan Telecom Group said the government had come to view the mobile sector as a “cash cow”, and added that the proposed tax would stifle the ability of operators to offer customers different types of services and payment methods, such as all-you-can-talk deals, and combined fixed and mobile bills.

“It makes a number of things very complicated, because let’s say you want to make a package between fixed and mobile, you will have a different tax applicable to the fixed traffic and mobile. As such, the complexity of the tax prevents simple marketing approaches from happening,” Vogeleer told CommsMEA.

“We are trying to do everything we can to simplify things and this type of initiative is not helping. It is also confusing for consumers not knowing exactly how much they are paying.”

Jawad Abbassi, general manager of Arab Advisors Group, a Jordan-based consultancy focused on the ICT sector, said the tax could amount to a 10% surcharge on the call rate for some packages in Jordan, or a 10% cut to the revenues for the operator.