CARIBBEAN: Barbados taxes cellphone use, hopes to make millions

CARIBBEAN: Barbados taxes cellphone use, hopes to make millions

old-phonesJAMAICA OBSERVER – The Barbados Government has introduced legislation amending the Value Added Tax (VAT) to allow for a 22 per cent tax on voice and other transmissions from cellphones.

Finance Minister Chris Sinckler told legislators on Tuesday night that the tax, which goes into effect from January 1, next year, will raise BDS$14 million (One Barbados dollar =US$0.50 cents) annually that would go towards funding university scholarships.

Sinckler said the proposed changes are meant to “increase the efficiency of tax administration, provide for the imposition of Value Added Tax on certain mobile services and enhance the enforcement provisions in the Act and for related matters”.

He said contrary to popular belief, the imposition would not only affect cellphone calls, but all mobile transmitting services and that following his initial announcement in June of his intentions to introduce a tax on cell phone services, “there was some discourse . . . largely driven by the media in Barbados, that we were just only applying the tax when people make calls in the use of their cellular phones”.

But Sinckler told legislators that “that is one form of mobile airtime.

“In the definitions that were provided, mobile airtime was taken to mean all services conducted across the bandwidth on the usage of a cellular phone,” the finance minister said, noting that “an expanse of capabilities that go beyond calling and sending the average text messages to somebody”.



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