Taxes, mobiles and development

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The Economist has published yet another article on the impact of taxation on mobile-phone adoption, an issue we have highlighted before (1 & 2).

As prices fall, another barrier to adoption becomes more apparent: the taxes on mobile phones in many developing countries… Hardly surprisingly, developing countries with high mobile taxes generally have far fewer mobile phones per person than those with low taxes (see chart)... India has reduced its handset import duties over the past three years, helping to boost penetration from less than 1% to more than 5%. Raising taxes can slow adoption: monthly subscriber growth in Bangladesh fell from 11% to 7% after the introduction of a $14 connection tax in June.

See the GSM Assoc. for the full "Tax and the Digital Divide" report, or Owen Barder for more commentary.

Note: Not a fan of the new Economist site - links are giving us troubles and undecided on the new look.

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