The recently introduced internet tax will hinder internet penetration in the country, experts say as operators raise concerns about the newly introduced tax.
“Implementation of the imposed duty will automatically slow down our members’ ability to roll out internet services in rural areas… internet development especially in the rural areas would be adversely impacted,” Tanzania Internet Service Providers Association (TIPSA) said.
“It is our belief that this new imposed excise duty will widen the digital divide, defeating the purpose of nationwide reach, to champion and create initiatives for internet access expansion in the uneconomic areas by TISPA. We urge the government to heed to our plea so that we can achieve our ICT4Development goals,” the association added.
This tax adds on to the increasing duties that IT companies are facing in East Africa. Just last week, the Kenyan government instituted a new law that would see bank transactions including mobile money and ATM transaction surcharged with a 10 per cent increase.
This follows months before when the government also imposed a 10 percent tax on mobile money transactions in the country.
It brings in the question of if African countries have the will and power to reduce the internet costs to make it accessible to the poor.
This year the internet penetration for the country has stood at 6 million people. These are the people that might feel the pressure of cost on the new tax.