A decrease in new subscribers pulled down the government tax-revenue collection from the telecommunications sector, the second largest source of receipts.
Officials said the tax-revenue receipt from telecom posted a negative growth in the last fiscal year compared to that of corresponding year largely due to a decline in new subscription.
Biometric SIM re-registration hubbub is seen as a main cause of the drop in numbers of mobile subscribers.       
The large taxpayers unit (LTU) under the Value Added Tax (VAT) wing of the National Board of Revenue (NBR) received Tk 88 million less revenue in the financial year (FY) 2015-16 compared to that of the collected revenue in the corresponding year.
The unit collected Tk 38.58 billion in VAT in 2014-15 from six mobile-phone operators in the country.
Grameenphone Limited, Robi Axiata Bangladesh Limited, Banglalink Digital Communications Limited, Airtel Bangladesh ltd, Pacific Telecom Bangladesh Ltd and Telecom Bangladesh Limited contribute around 14 per cent to the aggregate VAT collection by the LTU.
The unit explained the reasons for failure of its target recently to the NBR by sending a detailed analysis.
In the analysis, the LTU said connection of new SIM (subscriber identity module) dropped by 27,84,505 in FY'16 compared to that in FY'15.
According to the latest data available with Bangladesh Telecommunication Regulatory Commission (BTRC), the country has currently 131.3 million active mobile connections while 53.4 million of those are connected to the internet.
Although SIM replacement increased by 26,94,032, but due to reduction in mobile tariff rate in the budget the NBR lost Tk 6.74 billion in VAT from this sector alone in the last fiscal.
However, the VAT wing could minimise the volume of loss with the collection of higher amount as call charge.
The LTU received Tk 4.67 billion worth of higher revenue last year in the form of supplementary duty (SD) and VAT compared to that of the corresponding year.
In the budget for the current FY, the government increased SD on use of mobile phone by 2.0 per cent. The decision came into effect on June 2, 2016.
The LTU received some additional revenue in that period that has been added up to the collection of the last FY.
In the budget for 2015-16, the government had brought two changes in mobile tax measures. It imposed 3.0 per cent SD on mobile services through use of SIM and cut SIM tax to Tk 100 from Tk 300.
The LTU lost VAT worth Tk 6.84 billion due to cut in SIM tax by Tk 200 for each SIM.
For reduction in tariffs on mobile phone, the unit also incurred Tk 6.74 billion loss despite increase in the SIM replacement.
Ekram Kabir, vice president of the communications and corporate responsibility of Robi Axiata, said mobile-phone companies' subscribers dropped in number due to biometric registration of SIM.
"All of the mobile phone subscribers could not complete the biometric registration within the stipulated time. We have to cancel registration of those who failed," he said.
Revenue collection has dropped due to decline in subscriber base, he said.
Mobile-phone companies have to pay 55 per cent of their income as tax while consumers have to pay Tk 21 on use of Tk 100 in their cell phone.
Telecom companies are fixing competitive tariff rates to expand their respective subscriber base in their bid to turn around from the fall in the numbers of their subscribers.  
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Source: The Financial Express