Sudan to hike telecom taxes in revenue push

Author: 
REUTERS
Publication Date: 
Wed, 2011-12-21 00:51

Sudan has been pursuing fresh sources of income such as gold and agricultural exports since South Sudan declared independence in July, taking with it about three quarters of Sudan's oil output — a vital foreign currency earner for both governments.
Officials say they will also start a three-year austerity programme in 2012 and draft a plan to eliminate commodity subsidies that cost the state about $2 billion per year.
The government will raise sales and services taxes for telecoms firms to 30 percent from 20 percent and a tax on profits to 30 percent from 15 percent under the 2012 budget parliament approved on Monday, Mohamed Osman Ibrahim, manager of Sudan's tax office, said.
A social development tax will rise from three to five percent, he added.
Central Bank Governor Mohamed Kheir Al-Zubeir said Sudan would also try to stabilise the foreign exchange rate.
The Sudanese pound has weakened against the US dollar on the black market since South Sudan seceded, falling to as low as 4.3 pounds to the dollar last month. The official rate is around 3 pounds to the dollar.
"We aim to reach a stable exchange rate for hard currencies, as well as a single currency market and an end to the parallel market," Zubeir said.
"We are seeking foreign assistance from friendly countries to help stabilise the exchange rate."
Telecommunications has proven to be one of Sudan's most vibrant private sector businesses, despite US trade sanctions that have dampened investment in other fields.
Kuwait's Zain and South Africa's MTN operate mobile phone units in Sudan, competing with the local Sudan brand.
South Sudan split off from Sudan in July after voting overwhelmingly for independence in a January referendum, the culmination of a 2005 peace deal that ended decades of civil war between the north and south.

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