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Pakistan govt asked to reduce taxes on telecom industry

Maverick Report

Farida RashidISLAMABAD: The Islamabad Women’s Chamber of Commerce and Industry (IWCCI) has said that mobile phones are one of the most effective tools to alleviate poverty and provide opportunities to entrepreneurs so the government should reduce taxes on telecom industry.

“Pakistan’s telecom industry has been paying Rs57 billion tax every year, which is one of the most heavily taxed sectors in the SAARC [South Asian Association for Regional Cooperation] region,” said Farida Rashid, IWCCI president, in a statement.

“Mobile phones have brought about remarkable social progress in low-income countries while its impact has been estimated at a quarter of trillion US dollars in the poverty belt that includes South Asia and Sub-Saharan Africa,” she pointed out.

Mobile phone is a great productivity tool, which makes citizens economically strong who in turn make their governments more accountable and friendly to worthy causes, including a peaceful and prosperous world, the IWCCI president said.

Farida Rashid said that according to a study of 120 countries conducted by the World Bank, a 10 percent increase in mobile phone penetration results in a 0.8 percent increase in the economic growth.

From 1996 to 2011, mobile phone penetration in South Asia and Sub-Saharan Africa combined rose from zero percent to 63 percent. During the 15-year period the poverty belt experienced on average an additional one percent economic growth due to mobile phones, the study said.

Within this same period, the combined GDP of South Asia and Sub-Saharan Africa grew from $811 billion to $1.87 trillion, showing an average annual growth rate of 5.72 percent.

Without the impact of mobile phones, these economies would have grown at an annual rate of 4.72 percent, and the economy of the poverty belt by 2011 would have been $1.62 trillion only.

“Mobiles are not a luxury product became a mass product that advances economic situation of consumer by saving time, money, labor, transportation, and opportunity costs,” the IWCCI president said. “Cell phones have resulted in continued economic and social progress in low-income countries, therefore, telecom industry must be promoted by policymakers,” she demanded.

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