BTRC pushes SIM tax cut to revive telecom sector

The Bangladesh Telecommunication Regulatory Commission has proposed sweeping cuts to SIM-related taxes in a move aimed at reviving subscriber growth, reducing consumer costs, and accelerating Bangladesh’s digital transformation amid mounting concerns over stagnation in the telecom sector.

According to officials, the regulator has recommended reducing taxes on new SIM issuance while completely scrapping taxes on replacement SIMs and Internet of Things (IoT) or Machine-to-Machine (M2M) SIM connections.

The proposals were recently sent to the Ministry of Posts, Telecommunications and Information Technology and are now under review by the National Board of Revenue (NBR).

The recommendations emerged from a high-level meeting chaired by Prime Minister’s Telecom and ICT Adviser Rehan Asif Asad, attended by senior officials from BTRC, the telecom division, and revenue authorities.

BTRC officials argued that the existing tax structure has become a major barrier to digital inclusion and telecom expansion. Mobile operators currently spend around Tk 700 to activate a new SIM connection, with Tk 300 paid directly as SIM tax, while the rest covers SIM kits, distribution, and operational expenses.

The regulator said telecom companies effectively subsidise nearly half the cost of acquiring new subscribers, despite Bangladesh already having one of the lowest average revenues per user (ARPU) in the Asia-Pacific region. According to industry estimates, operators often require between five and nine months to recover customer acquisition costs.

Industry groups and global telecom bodies have long criticized Bangladesh’s high telecom taxation regime.

The GSM Association (GSMA) recently urged the government to abolish SIM taxes entirely, warning that rising regulatory costs are discouraging mobile and internet usage, particularly among low-income users.

Telecom operators also claim Bangladesh’s mobile service taxes remain significantly higher than regional averages. Industry body AMTOB said operators currently pay nearly 56 percent of gross revenues in taxes, VAT, and other charges, compared to an Asia-Pacific average of around 26 percent.

The BTRC additionally proposed removing taxes on replacement SIMs, arguing that charging consumers again for restoring existing numbers amounts to double taxation. It also recommended tax exemptions for IoT SIMs to encourage the expansion of smart technologies in agriculture, logistics, manufacturing, and smart city services.

The proposals come as the government prepares broader telecom reforms ahead of the upcoming national budget, with policymakers signaling plans for a long-term tax restructuring to expand connectivity and strengthen Bangladesh’s digital economy ambitions