Jordan considers raising telecom taxes

2 Jul 2012

The Jordanian government is considering increasing the amount of tax imposed on telcos in the form of revenue sharing to bring it closer in line with other countries in the region. According to the Jordan Times, the sector watchdog the Telecommunications Regulatory Commission (TRC) has been tasked with weighing up the potential impact of increasing revenue sharing beyond its current 10%. At present, the sector is also subject to a 16% sales tax, a 12% special tax and a 24% income tax, in addition to the 10% as revenue sharing. TRC Chief Commissioner Mohammad Taani said that: ‘The examination will show us if it is possible to increase the revenue sharing and to what level without harming the sector.’ One of the options considered was a gradual increase of 2%, though not to exceed 20% – citing the Iraqi system as a similar example, where telcos pay 18% as revenue sharing.

The heads of the nation’s trio of wireless providers, Umniah, Zain Jordan and Orange Jordan protested against the measure, saying that it would be ‘disastrous’ for the sector. Umniah’s CEO Ihab Hinnawi added that the sector was facing cost increases elsewhere, referring to a jump in the price for electricity. In an earlier statement, Hinnawi doubted that cellcos would be able to absorb any further taxes.