Published: Wednesday, June 19, 2013

Top court directs NBR to resolve SIM tax dispute

The High Court has directed the tax authority to solve the ongoing legal dispute with the four mobile operators over unpaid dues for replacement SIM cards amounting to Tk 3,100 crore.
The HC has ordered the National Board of Revenue to resolve the issue within 120 days of receipt of the judgement, Sunil Kanti Bose, chairman of Bangladesh Telecommunication Regulatory Commission, told The Daily Star yesterday. The directive was given out on June 6.
The NBR in early 2012 claimed around Tk 1,580 crore from Grameenphone, Tk 774 crore from Banglalink, Tk 654 crore from Robi and Tk 82 crore from Airtel, as taxes on the replacement SIM cards issued.
The tax authority conducted a sting operation in November 2011, where some of its officials purchased 5 SIM cards from each of the operators. They later sought for replacement SIMs, but the details they put in were different from the ones they used when acquiring the original SIM card.
Using the logic, the NBR concluded that the mobile operators were selling new SIM cards under the guise of replacement ones, so they must pay the full SIM tax on them.
A replacement SIM card is issued by an operator when subscribers report their original SIM cards to be lost, stolen or damaged. The old SIM card is written off, while the mobile number stays the same.
And, as per current rules, formulated on June 13, 2005, operators are not obliged to pay taxes on SIM cards issued as replacements. Accordingly, the four mobile operators took the matter to court in May last year.
“Actually, the operators pay tax for the number and not for the SIM card. The replacement SIM cards bear the same number as the original SIM card, so the NBR cannot tax us for that,” said Mahmud Hossain, chief corporate officer of Grameenphone.
“Plus, it is impossible to have two SIM cards bearing the same mobile number to be in operation at any one time,” he said.
Zakiul Islam, senior director of the legal and regulatory department of Banglalink, said: “We have done nothing wrong — we replaced the SIMs following the guidelines of BTRC. The NBR should review the whole issue properly.”
He called for the issue to be resolved before the 3G auction takes place.