Philippines. SMS is tax goldmine

Filipinos send an estimated two billion text messages a day on their mobile phones, making the Philippines the texting capital of the world. Consumers are against the proposed five-centavo tax on every SMS sent. The Straits Times reports.

The Short Message Service (SMS) is seen as a potential goldmine for the cash-strapped government because of the vast number of text messages - estimated at two billion a day - sent by Filipinos.

Such heavy reliance on text messaging has generated huge revenues for telecommunications companies, which are protesting against the proposed tax.

A Bill in the House of Representatives is seeking a tax of five centavos (0.15 Singapore cents) on every text message sent by mobile phone. Its backers estimate that the tax would raise between $590 million and $1 billion in revenue for the government.

The measure was passed this month by a key congressional committee, putting it firmly in the legislative pipeline. In the Senate, some lawmakers have said they will not approve the special tax if it hits the pockets of the poor.

The administration of President Gloria Arroyo, which has majority support in the House, is backing the measure as long as consumers do not have to shoulder the tax. Its chances of being passed will improve if Congress can be convinced that will indeed be the case.

Not surprisingly, service providers are lobbying hard against the tax. They argue that consumers would be affected because cheap SMS promotions offering, for example, unlimited texting over a given period, will no longer be feasible.img alt="quotesmarksleft.jpg" src="http://www.textually.org/textually/archives/images/set3/quotesmarksleft.jpg" width="20" height="15" />

Related:

-- Philippines. "No to Text Tax!" campaign

-- Online campaign launched vs. text tax in the Philippines

-- Philippines. House body OKs tax on text messages

-- Related attempts to tax SMS around the world

emily | 8:17 AM | SMS and Politics |
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