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Wednesday, Oct 16th

Ivory Coast imposes new tax on mobile money transfers

Ivory Coast imposes new tax on mobile money transfers

Mobile money transfers in Ivory Coast now cost 0.5% more following the implementation of a new tax effective 1 January 2018, announced by the government and contained in the country's latest tax schedule law.

The country's government admitted that enforcing the law may prove difficult without the full cooperation of the operators, since the tax administration is struggling to independently confirm the precise volume and value of money transfers in the country. They require the cooperation of operators to make available that data.

Under the tax schedule, the new tax would be paid by the sender and not the receiver. Prior to the newly implemented legislation, mobile money transfers only incurred telecoms service costs, such as the cost of sending SMS.

Last year, René Tano, Head of Cash Management at the International Bank for Trade and Industry of Côte d'Ivoire (BICICI) revealed that about the daily volume of mobile money transactions in Ivory Coast stood at 17 billion FCfa.

Government-backed regulatory authorities in Kenya, Tanzania and Uganda have imposed a 10% excise on mobile money transaction fees while in Zimbabwe, there is a surcharge on each individual transaction.

Commenting on this trend, GSMA's regulatory director for Africa, Brian Muthiora, said the brunt of the new tax regimes would severely affect users already below the poverty line. Rather than introduce new taxes, the organisation urged African regulators to focus on expanding revenue mobilisation and support the growth of mobile money across the continent

"Rather than levying taxes on the fledgling mobile money industry, governments should consider enabling the growth of mobile money services by digitising the payment of fees, rates, taxes and levies due from taxpayers," said Muthiora.

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