Bill sends 'wrong' signals to mobile phone firms' investors

MANILA, Philippines - Allowing government to collect half of its text messaging revenues and allot it for health and education—as proposed by a Senate bill— “will send the wrong message to actual and potential investors," the Philippines’ second-largest mobile phone company said. In a position paper issued in reaction to Senate Bill 2402, Globe Telecom Inc. said that the cellular mobile telephone business “is highly capitalized, and is characterized by fast obsolescence of technology and equipment." “Providers and their foreign partners had managed to invest hundreds of billions of pesos to put up their respective networks, and whatever revenue they may have generated is simply a reasonable return of their investments," the company’s position paper said. Once enacted, the proposed law—filed by Senator Richard Gordon—will prompt Globe to increase its text messaging fees if half of its revenues will be collected by government. Subtracting half of its revenues from its text-messaging revenues worth P0.27 apiece, then the cost per text due Globe will plunge to below zero centavos, Globe said. “The imposition simply adds fire to the belief that the reason for this selective and confiscatory tax is simply due to the immense popularity of SMS and the misperceived huge revenues of the CMTS [cellular mobile telephone subscribers] providers from the service," Globe said. Last year, Globe said it paid more than P15 billion in taxes to the national government alone, besides other fees and duties paid to local government units and other government agencies. “Better tax administration and more efficient tax collection is the key, rather than the double or multiple taxation of those already overtaxed! The tax burden must be shared equally and equitably," Globe said. -GMANews.TV