Zimbabwe's acting Minister of Finance, Patrick Chinamasa has proposed a cut in the value added sales tax on mobile phone airtime from 22.5% to just 15%.
“I propose to standardise the rate by reducing it to 15% with effect from 1 February 2009, in line with the prevailing general level of VAT on other products,” he said. “This should translate into lower mobile phone tariffs.”
The operators have come under pressure to lower their tariffs, despite the hyper-inflation being felt in the country. However they claim their tariffs are comparable with the region - but are being hurt by the high VAT rate, which at 22.5% were the highest in the region.
At the end of last year, Econet Wireless announced that it would start charging in foreign currency in order to fund improvements to services by enabling the company to invest in new equipment and settle its foreign currency obligations.
Econet Wireless is the largest operator in the country by subscriber numbers. According to estimates from the Mobile World, the operator ended last September with 977,000 customers and a market share of 64%. The country has a population penetration level of just over 12%