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Ghana: Telecoms Pay GH¢4.9bn In Taxes In 5yrs

BY Raju Raghu Parwani

DESPITE the many challenges it faces, Ghana’s mobile telecommunications industry has paid GH¢4.92 billion in total tax contribution to government in the past five years.

According to the Ghana Chamber of Telecommunications, the mobile telecoms industry since 2011 has contributed a total of GH¢4.92 billion in tax contribution, public funding and network quality while direct tax amounted to GH¢1.42 billion.

The industry also provides jobs to some 6,200 people directly and another 1.6 million indirectly.

Starting in 1992 with just one player, Mobitel (now Tigo Ghana), Ghana’s mobile telecoms industry has grown into an ecosystem that for the past five years has contributed an annual average of GH¢1 billion to Ghana’s economy.

“There are few industries that have such an intravenous effect on everyone whilst impacting the national economy as the mobile industry,” Chief Executive Officer (CEO) of the Ghana Chamber of Telecommunications, KwekuSakyi-Addo said.

The CEO of the Chamber was speaking at the launch of the 5th anniversary of the Ghana Chamber of Telecommunications.

The Chamber was established in November 2011 as a coalition for five out of the six telecoms operators – MTN, Vodafone, Airtel, Tigo and Expresso – in recognition that they were in stronger position to make inputs to shape the environment if they worked together.

Three tower companies – ATC, Eaton and Helios – later joined in 2015.

Ghana’s mobile telecoms industry has grown immensely since 2011. According to Mr Sakyi-Addo, the industry has seen substantial investment and growth since 2011.

“A lot has happened in the last 5 years. Five years ago many people had no mobile phones, even if they did they were using feature phones. Today many of them are using smartphones,” he said.

This is explained by the continuous fall in prices of smartphones on the market and the general shift from voice to data usage.

According to the industry regulator, National Communication Authority (NCA), as at the end of August 2016, the total number of mobile voice subscribers was 36,912,019 up from 19,893,191 recorded at the end of August 2011. The total penetration rate for both periods was 132.44 per cent up from 80.5 per cent, respectively.

At the end of August 2016, the total subscribers of mobile data in the country were 19,125,469 with a penetration rate of 68.62 per cent, up from some 8 million subscribers recorded in 2011.

On mobile financial services also, the total value of mobile money transactions recorded by all four telecoms that provide the service since their individual inceptions currently stands at GH¢35 billion.

Even as the industry is growing in leaps and bounds, the industry still faces myriad of challenges.

The telecommunications companies have over the years invested millions of dollars on network expansion projects, to make services better for subscribers. However, fibre cuts, cable and battery thefts still cost these companies millions of cedis which would have otherwise been used for network upgrade or expansion.

Aside having to deal with these menaces, telecoms companies are met with stiff opposition by community leaders in their bid to mount telecoms towers (masts).

Mr Sakyi-Addo urges communities to be embracing to the tower infrastructure in our communities because the more towers there are, the better the services will be.

“It also incumbent on the tower companies to engage communities because if there is an understanding among the communities they will also be open to accept the infrastructure,” he added.

He said the EPA monitors to ensure that the towers are safe and secure so there are no threats to lives.

The industry is also calling for the removal of 20 per cent import tax on smartphones. It believes the move will favour all Ghanaians business wise, increase revenue generation and also curb stealing, smuggling and other criminal activities while increasing the penetration rate.

Mr Sakyi-Addo said the whole idea telecommunications now is to empower people, so that they can conduct their activities conveniently, more cost-effectively and efficiently. “So with less, they can do more. And when you add up all their efficiency gains and you aggregate it, it impacts the national economy.”

The CEO also called on all subscribers to register their SIM cards and also to register for mobile money.

“5 years from now we want to transact more on our mobile phones and use the mobile phone as a platform for payments so we want to see fewer people take their cash out when they receive mobile money, they should also use it to make payments not to go and withdraw. As more people register, there is less need to take out the cash,” Mr Sakyi-Addo noted.

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