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SIM replacement tax dispute may delay Bangladeshi spectrum auctions

Bangladesh’s spectrum auctions look likely to be delayed again due to a regulatory dispute concerning SIM replacement taxes.

The auctions have already been delayed by a month to May 20th, but a further postponement is now likely after a meeting between the country’s major operators and various government figures failed to reach a positive outcome.

The meeting was attended by representatives of Airtel, Banglalink, Grameenphone and Robi, as well as the heads of the National Board of Revenue (NBR), the Bangladesh Telecommunication Regulatory Commission (BTRC), and the Telecommunications division secretary.

The government is arguing that the four major operators owe back payments of taxes for replacement SIMs, which they provided tax-free to customers. While the government is not demanding interest for these payments, it has stipulated that the case must be dropped before the auctions can go ahead.

However, the parties are evidently at loggerheads; the operators have informed the finance minister that they have jointly agreed not to participate in the auctions unless the tax dispute is resolved first. The current auction schedule would require operators to submit applications to bid by April 16th, prompting one operator to remark that the auctions would therefore “obviously need to be rescheduled”. 

Operators currently pay BDT300 tax for every new SIM sold and a flat BDT100 tax for every replacement SIM. Last June, operators called for the latter tax to be dropped from the national budget for the fiscal year of 2014-15.

 

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