Brazilian regulator Anatel's board of directors has approved a survey that addresses the very high payments made to the public purse by the telecommunications sector. It will be forwarded to the ministries of finance and communications, bodies responsible for studying and proposing legal changes related to the taxation of the sector.
The Teletime news service reports that the study addresses three themes: the current tax system, the redesign of the tax system, and the redefinition of the tax burden.
It proposes a broad tax review, which, it seems, recognises the positive potential of a lower tax burden on service prices, quality and access to services, not least given the present situation. This is one of a high tax burden applied to telecommunications service providers in Brazil – one of the largest such burdens in the world, the report clams.
The report also points out that it’s not just the taxes themselves that are an issue but the complexity of calculating and policing them, itself an additional cost for the sector and for Anatel itself.
Anatel’s board has proposed a significant simplification of the tax system as well as a reduction of the tax burden. The president of Anatel, Carlos Baigorri, argues that this is both important and relevant at a time when, apparently, the National Congress is discussing tax reform.
According to Anatel, the proposal is of paramount importance, but will government agree? Given recent similar sentiments from both Hungary and Nigeria, it will be interesting to see whether there is a positive response to Anatel’s report. We can probably take it as read that service providers will be supportive.