No need to tax text messages

SOLON MULLS GOV’T SHARE FROM 

PROFITS ON TEXT MESSAGING SERVICE

Instead of imposing a tax on text messages, administration congressman Prospero Nograles said the government should get a cut from the millions of profits generated by telecommunications companies from their text messaging service.

 Nograles, a member of the House Committee on Transportation and Telecommunication, said that mobile phone service providers such as Globe Telecoms and Smart Communications are already arbitrarily over-charging consumers with their Short Messaging System (SMS) and the government has all the right to ask for a dividend as a revenue generating measure.

“Text messaging should be in fact free because this is a feature available to our GSM phones. But since we are paying for our text messages, the government should have a dividend from the text messaging service being provided by the telecoms companies,” Nograles said.

Based on his computation, Nograles said that Globe and Smart easily generate P150 million to P200 million daily from their text messaging service, or a whopping P4.5 billion to P6 billion every month.

Telecommunication companies charge P1 to P2 for every text massage sent. Estimates reveal that at least 150 million text messages are sent everyday by mobile phone users.

“This is on text messaging alone. The telecoms companies also make a lot of money out the charges that they impose on phone calls, pre-paid card sales and many other services that they offer,” Nograles said.

He proposed that the DoF should look into the possibility of getting a cut from the income raised by telecommunication firms through their text messaging service.

“The government should ensure however that no additional charges should be imposed on consumers,” Nograles said.

He said the DoF plan would certainly stir an upheaval from the millions of Filipino mobile phone users, particularly those belonging to the poor and the middle class sector.

“Naghahanap lang ng gulo ang DoF pag itinuloy nila ito (The DoF is only inviting trouble if they would proceed with their plan),” Nograles said.

Nograles said that his proposal is a better alternative to help the government raise much needed revenue that would support the pro-poor programs of President Arroyo.

Nograles pointed that even before the DoF announced its plan to tax the text messaging service for mobile phones, he has already asked Negros Oriental Rep. Jacinto Paras, chairman of the House Committee on Transportation and Telecommunications, to conduct a probe on the additional charges imposed by mobile phone service providers on use of the text messaging service.

Nograles is interested to  find out why additional charges has to be imposed on text messages  which is a feature that is already available on all digital phones. He is also questioning the fact that mobile phone service providers do not have a detailed billing on their text messaging service.

He also wants the mobile phone service providers to fully account how much they really earn from this particular service.

April 20, 2002