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SIM Cards: A taxing issue

On 25 June, 2013, the National Assembly approved the government budget for 2013/2014.

A few days after the approval of the budget, it became clear that the government had imposed a once-a-month levy of TZS 1,000 for every SIM card. Surprisingly, Members of Parliament and ordinary citizens who were following up the budget speech claimed that the levy, subsequently dubbed the “SIM Card Tax”, was not discussed in Parliament. It led to a national debate among citizens, mobile phone operators, media houses, technocrats and Members of Parliament.

Sauti za Wananchi sought citizens' views on the issue.

The main findings are:

Most Tanzanians have access to a mobile phone
Although mobile phone ownership is concentrated in urban areas and in richer households, three-quarters of rural residents live in a household in which at least one member owns a mobile phone. Just over half (52%) of the poorest households also have one phone.

The tax amount is equivalent to one week worth of airtime for the poorest households
On average, the poorest 10% of households spend TZS 3,154 per month on airtime. This means that they spend less than the SIM Card Tax of TZS 1,000 per week. In contrast, the richest 10% of households spend TZS 45,236 on airtime per month.

Less than half of Tanzanians are aware of the SIM Card Tax
Nationally, 46% of citizens are aware of the SIM Card Tax. In urban areas more people know about the tax (55%) while rural areas, there is significantly lower awareness (41% of rural citizens know about the tax).

Most people disagree with the SIM Card Tax
Across all income groups, large majorities, 83% on average, disagree with the SIM Card Tax. Surprisingly, among the poorest households a relatively lower proportion (71%) disagree with the SIM card tax. The strongest objection comes from better-off households, where 86% citizens disagree with the tax.

Read more: budget citizens mobile phones Sauti za Wananchi

Authors: Elvis Mushi Youdi Schipper

Editors: Rakesh Rajani Risha Chande

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Organizations: Twaweza

Pages: 6

Type: Policy brief

Year: 2013

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