Budget FY21: Mobile phone use likely to become costlier

Mobile phone use is likely to become costlier in the 2020-21 fiscal year, as the government has proposed a 5% hike in the supplementary duty (SD) on mobile phone services - voice and data – in the proposed budget.

The supplementary duty has been proposed at 15% from the existing 10% on services provided through mobile phone SIM/RIM cards, according to the budget speech by Finance Minister AHM Mustafa Kamal at parliament on Thursday.

Currently, in addition to the SD, mobile users pay a 15% value-added tax and 1% surcharge on talk-time and messaging services, while the VAT on mobile internet use is 5%.

The government first imposed a 3% SD on voice, internet, SMS, and other mobile phone services in FY2016, which was increased to 5% in FY2017 and 10% in FY2020.