Zimbabwe - Telecoms, Mobile and Broadband - Statistics and Analyses

Zimbabwe - Telecoms, Mobile and Broadband - Statistics and Analyses

Zimbabwe’s MNOs increase tariffs for voice and data services to address pressure on revenue The Zimbabwean government has for some years addressed the country’s economic difficulties by finding ways to tax telecom services. Telcos have also been under economic pressure, facing stresses on revenue and on their ability to invest in infrastructure and network upgrades. This has encouraged the telcos to increase tariffs, supported by the regulator. During 2019 and 2020, the regulator imposed three tariff hikes in succession as it strove to alleviate the financial burden suffered by the MNOs which must pay for international bandwidth and network equipment in foreign currency. In April 2019 tariffs for mobile voice calls were increased by 23%, while in the following November they were increased by 95%. A third hike in March 2020 saw the tariffs increased by 55%. These hikes were responses to the deterioration of the economy. In early 2022, telcos increased tariffs again, by up to 20%, as they sought to adjust to pressure on revenue. There are numerous taxes on telecom services, which add to the burden on telcos and end-users. A 15% VAT has applied to mobile airtime since 2009, while in 2015 a 5% excise duty on airtime sales was imposed, as well as a 25% tax on handsets and a five cents levy per transaction on mobile money transfers. In November 2021, telcos called on the government to reduce the high tax burdens placed on them. Taxes at the time included a 5% health levy, the 15% VAT, a 25% corporate tax, a 3% universal service fee, and a 2% tax on m-money transfers (the Intermediated Money Transfer Tax). Despite these appeals, the government in March 2022 introduced a 10% excise duty on ISPs. There is also the prospect of a new tax on companies involved in e-commerce, digital advertising, content, cloud computing, e-commerce, and a range of online services such as gambling and gaming. Within this catchment are the major online players such as Google, YouTube, and Facebook, as well as streaming providers such as Netflix. In addition to taxes, there is a $50 levy on imported smartphones. This levy was imposed in November 2021 after the government realised that the existing 25% duty on mobile handset imports was easily evaded.