ICC discussion paper on the adverse effects of discriminatory taxes on telecommunications services

    Prepared by the ICC commission on : Commission on the Digital Economy
    Publication date : 26/10/2010 | Document Number : 373/495

    A number of countries apply taxes to telecommunications goods and services at higher levels than for other goods and services. These burdensome and discriminatory taxes deter the adoption and use of broadband, mobile and other advanced ICT sector tools that are major drivers of development and growth in the information-based economy of the 21st century.

    The World Bank has found, based on an econometrics analysis of 120 countries, that each 10% increase in broadband penetration increases economic growth by 1.3%.1 Unfortunately, the tax treatment of telecom goods and services sometimes reflects the outdated view that communications services should be taxed as luxuries affordable only by the rich – rather than as essential services for all, which they are today.