Government denies link between mobile card price increase, new taxes

The government has denied a link between soaring prices of prepaid mobile phone cards and any new tax measures.

The National Telecommunication Regulation Authority Government bodies said on Monday that the recent increase in the prices of prepaid cards was not a result of new taxes adopted by the government, and said that people should not pay more than the official rates set by telecom companies.

In its statement, the authority also said that Vodafone has offered clients a 100 percent raise in conversation minutes in return for a 15 percent increase in the value of prepaid cards, and urged customers to report merchants selling cards for prices higher than the announced rates.

The Egypt Tax authority issued a statement saying that there were no new sales taxes on mobile phone services, and that the only increase was 15 percent of the value of the balance card or the monthly voucher.

In the statement, ETA head Mamdouh Omar also said that the decision of the three mobile phone operators to increase their prices is "an internal affair and has nothing to do with taxation."

Three mobile operators are currently serving in the Egyptian market: Vodafone, France Telecom’s Mobinil, and the Emirati company Etisalat. Telecom Egypt, the sole provider of the country’s fixed line telephone service, is also seeking to enter the field.

In December, the Egyptian government approved new tax increases on a number of commodities, including cigarettes and soda drinks, but later retracted them amid mounting criticism, saying they would first put the increases up for public dialogue.

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