The Democratic Republic of Congo has reportedly mandated operators to pay levies totalling $180 million per year which operators have apparently refused to pay, reported Bloomberg.
Sources speaking to the publication said the government has sent invoices to the DRC’s four operators Orange, Vodacom Group, Airtel Africa and Africell, via the country’s regulator and consultancy firm 5C Energy.
Corruption and government mismanagement have forced the DRC to scramble for cash, despite being the world’s largest producer of copper and cobalt, reported Bloomberg.
The Federation Des Entreprises Du Congo, the nation’s main business association claimed the operators have rejected the levies, stating they were “irregular” and “unenforceable”.
Airtel Africa and Orange declined to comment to Developing Telecoms. Vodacom and Africell have yet to reply.
A source close to the matter told Developing Telecoms: "The new tax will do long-term damage to the DRC telecoms sector. Not only will many existing products be priced off the market, hurting customers who rely on them, but operators will need to reduce investment and cut jobs to afford the additional tax burden.
"Expansion of services into poor and rural areas will slow down as operators are forced to cut costs and focus on the most profitable (primarily urban) areas. The tax will exacerbate the digital divide in DRC and widen the urban-rural and gender gaps – shrinking of which is vital to social and economic development. The tax, which has been imposed with no transparency or consultation, is a big blow and will make DRC a less appealing place for international companies to invest and do business."
This is not the first time the government has caused controversy in the telecoms sector, having tried to introduce a tax on mobile devices, which drew backlash and was withdrawn.
