DOCSLIB.ORG

Digital Inclusion and Mobile Sector Taxation in Bangladesh

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Digital Inclusion and Mobile Sector Taxation in Bangladesh Digital Inclusion and Mobile Sector Taxation in Bangladesh MARCH 2015 DIGITAL INCLUSION AND MOBILE SECTOR TAXATION IN BANGLADESH Important Notice from Deloitte This final report (the “Final Report”) has been All copyright and other proprietary rights in the Final prepared by Deloitte LLP (“Deloitte”) for the GSMA on Report are the property of the GSMA. the basis of the scope and limitations set out below. This Final Report and its contents do not constitute The Final Report has been prepared solely for the financial or other professional advice, and specific purposes of assessing the economic impacts of advice should be sought about your specific mobile sector taxation in Bangladesh by modelling the circumstances. In particular, the Final Report does potential impacts that could be realised by a change not constitute a recommendation or endorsement by in mobile taxation under a set of agreed assumptions Deloitte to invest or participate in, exit, or otherwise and scenarios. use any of the markets or companies referred to in it. To the fullest extent possible, both Deloitte and No party other than GSMA is entitled to rely on the the GSMA disclaim any liability arising out of the use Final Report for any purpose whatsoever and Deloitte (or non-use) of the Final Report and its contents, accepts no responsibility or liability or duty of care to including any action or decision taken as a result of any party other than the GSMA in respect of the Final such use (or non-use). Report or any of its contents. As set out in the contract between Deloitte and GSMA, Deloitte contact the scope of our work has been limited by the time, Davide Strusani information and explanations made available to us. TMT Economic Consulting, London The information contained in the Final Report has [email protected] been obtained from the GSMA and third party sources www.deloitte.co.uk that are clearly referenced in the appropriate sections of the Final Report. Any results from the analysis contained in the Final Report are reliant on the information available at the time of writing the Final Report and should not be relied upon in subsequent periods. Accordingly, no representation or warranty, express or implied, is given and no responsibility or liability is or will be accepted by or on behalf of Deloitte or by any of its partners, employees or agents or any other person as to the accuracy, completeness or correctness of the information contained in this document or any oral information made available and any such liability is expressly disclaimed. 2 DIGITAL INCLUSION AND MOBILE SECTOR TAXATION IN BANGLADESH CONTENTS IMPORTANT NOTICE FROM DELOITTE 2 EXECUTIVE SUMMARY 5 1 THE MOBILE SECTOR IN BANGLADESH 11 1.1 Overview of the mobile sector 11 1.2 Mobile supports the government’s growth objectives 14 1.3 Barriers to digital inclusion in Bangladesh 18 2 MOBILE TAXATION IN BANGLADESH 24 2.1 Taxes on mobile consumers in Bangladesh 25 2.2 Taxes on mobile operators in Bangladesh 28 2.3 Best practice in taxation policy 32 3 ECONOMIC IMPACTS OF REFORMING MOBILE TAXATION IN BANGLADESH 35 3.1 How mobile taxation in Bangladesh impacts the economy 35 3.2 Removing the SIM card sale tax promotes digital inclusion and economic growth 38 3.3 Reducing the customs duty on network equipment stimulates investment and growth 41 3.4 Introducing a 1% surcharge on all mobile services could harm the development of mobile and hinder economic growth 43 3.5 Other tax reformation alternatives 45 4 MOBILE TAXATION IN BANGLADESH: AN AGENDA FOR REFORM 47 4.1 Contribution to fiscal stability 47 4.2 Options to align mobile taxation to standard goods taxation 48 APPENDIX A METHODOLOGY 50 APPENDIX B GLOSSARY OF TERMS 59 3 DIGITAL INCLUSION AND MOBILE SECTOR TAXATION IN BANGLADESH “Achieving Middle Income Country status by 2021 will require more than business as usual. Bangladesh will need to do more of the same and beyond.” Dr. Zahid Hussain, Senior Economist, World Bank Bangladesh1 4 DIGITAL INCLUSION AND MOBILE SECTOR TAXATION IN BANGLADESH Executive Summary Digital inclusion: the role of mobile Since the award of the first licence in 1989, the In terms of social benefits, mobile supports mobile sector in Bangladesh has enabled a wider ecosystem which enables millions of 66 million Bangladeshis to gain access to Bangladeshis to benefit from the exchange of transformative mobile technologies, including ideas and information, as well as improved access the mobile internet2. The increase in mobile to healthcare, education, financial and agricultural access has brought a wide range of benefits to information services. the Bangladeshi economy and society, including increased productivity and economic growth. Mobile operators also make a significant Further increasing access to mobile has the contribution to public finances.Mobile potential to further accelerate Bangladesh's operators’ turnover represented about 0.74% economic and social development towards the of the country’s GDP in 2013. In parallel, they government’s objectives of “Digital Bangladesh” accounted for 6.6% of Bangladesh’s total tax and its wider Vision 2021 objectives3, which revenues7. By investing in network rollout and include reaching middle-income country status innovation, mobile operators have the potential in the next six years. to extend access to mobile services – or “digital inclusion” – thereby enabling more Bangladeshis A number of economic studies have recognised to fully participate in the economy and gain the potential that mobile has to support positive access to vital services. economic impacts, in particular: Today, Bangladesh’s fixed line penetration is less • Studies by the GSMA and the Word Bank than 1%8. On the other hand, over 90% of people have estimated that a 1% increase in mobile with access to the internet use it via a mobile penetration could lead to an increase in the connection over the 2G network, via feature- GDP growth rate of 0.28%, while a 1% increase phones or low-end smartphones9,10 and, in the in internet penetration can lead to an increase future, it appears likely that mobile will represent of up to 0.077% in the GDP growth rate4. the most cost-effective way of extending access to Information and Communications • The World Bank has found that in low and Technologies (ICT) and broadband internet in middle-income countries, such as Bangladesh, the country. The key role of mobile technologies, every 10% increase in broadband penetration which can be deployed quickly and at relatively accelerates economic growth by 1.38%5. low cost, has been recognised by the Broadband Commission, which has found that typically • Other research suggests that for every new mobile is more effective than fixed line telephony job created in the Bangladeshi mobile sector, in enabling countries to achieve their national 11 are generated in the wider economy6. broadband goals11. 1. http://www.worldbank.org/en/news/feature/2012/11/13/towards-accelerated-inclusive-and-sustainable-growth-in-bangladesh 2. Unique subscribers, measured by the GSMA Intelligence Database. 3. Centre for Policy and Dialogue, 2007, Bangladesh Vision 2021. 4. This is based on GSMA 2012 and Qiang, C. Z. W., Rossotto, C.M., 2009. 5. Qiang, C. Z. W., Rossotto, C.M., 2009. 6. See, for example, Moretti, 2010, O2 for ONS, 2002, Ovum, 2010; Zain, Ericsson, 2009, Kaliba et al., 2006. 7. Deloitte analysis based on operator data and IMF. This includes non-recurring fees, such as the initial spectrum fee, 2G licence fee and advance income tax. If these fees are excluded, mobile operators contributed 4.1% to total tax revenues in 2013. 8. World Bank Development Indicators, 2013. 9. http://www.basis.org.bd/resource/Bangladesh-Telecoms-Tiger.pdf 10. GSMA Intelligence, 2014, Country Overview: Bangladesh, 11. ITU/Broadband Commission/Cisco, Planning for progress: Why national broadband plans matter, 2013. 5 DIGITAL INCLUSION AND MOBILE SECTOR TAXATION IN BANGLADESH What is holding digital inclusion back? Despite substantial industry growth recently, In Bangladesh, Average Revenue per User 92 million Bangladeshis remain without (ARPU) is one of the lowest in the world access to mobile services, and only 4.5% of and the second lowest in the region. With the population is connected to a 3G network12. six national mobile operators, the high level This places Bangladesh behind its neighbours of competition in the market means that in terms of subscriber penetration, and below mobile operator revenue has been decreasing global and regional averages13. Although 2G over recent years, creating a challenging coverage is already close to 100%, the first environment for investment. At the same new generation networks have only recently time, Foreign Direct Investment (FDI) in the been deployed and the expansion of mobile telecoms sector has fallen in recent years broadband and digital inclusion in Bangladesh compared to other sectors19. In this uncertain is constrained by barriers to affordability climate for investment and low profitability, on the part of consumers and barriers to high mobile-specific taxes may further investment on the part of mobile operators. discourage investment, especially in new Both of these types of barriers are affected by 3G and 4G technologies. This is reflected by mobile-specific taxation. Bangladesh’s low ranking on the Ease of Doing Business Index, ranked 170 in 2014, a decline In Bangladesh, nearly 31.5% of the population relative to its position at 129 in 201320. lives below the national poverty line14, and annual GDP per capita was approximately Mobile operators in Bangladesh paid about US$958 in 201315. This means the cost of a US$1.2 billion in recurring tax payments in smartphone is, for some people, similar to a 2013, which represented about 45% of total monthly wage.
Load more

Recommended publications
  • Arbeitskreis Quantitative Steuerlehre
    arqus Arbeitskreis Quantitative Steuerlehre www.arqus.info Diskussionsbeitrag Nr. 3 Caren Sureth / Ralf Maiterth Wealth Tax as Alternative Minimum Tax ? − The Impact of a Wealth Tax on Business Structure and Strategy − April 2005 arqus Diskussionsbeiträge zur Quantitativen Steuerlehre arqus Discussion Papers on Quantitative Tax Research ISSN 1861-8944 Wealth Tax as Alternative Minimum Tax ? – The Impact of a Wealth Tax on Business Structure and Strategy – Caren Sureth∗ † and Ralf Maiterth∗∗ April 2005 ∗ Prof. Dr. Caren Sureth, University of Paderborn, Faculty of Business Administration and Economics, Warburger Str. 100, D-33098 Paderborn, Germany, e-mail: [email protected] † corresponding author ∗∗ Dr. Ralf Maiterth, University of Hanover, Department of Economics, K¨onigsworther Platz 1, D-30167 Hanover, Germany, e-mail: [email protected] Wealth Tax as Alternative Minimum Tax ? – The Impact of a Wealth Tax on Business Structure and Strategy – Abstract An alternative minimum tax (AMT) is often regarded as desirable. We analyze a wealth tax at corporate and personal level that is designed as an AMT as proposed by the German Green Party. This wealth tax is imputable to profit taxes and is hence intended to prevent multiple (multistage) taxation. Referring to data from annual reports and the German Central Bank we model enterprises of different structure, industry, size and legal status. We show that companies in the service sector which generally maintain rather high gearing rates are more frequently subjected to the wealth tax than capital intensive industries. This result runs counter to well-known effects of a common wealth tax. Capital intensive firms, e.g. in the metal industry, are levied with definitive wealth tax only if they have large loss carry-forwards or extremely volatile profits.
    [Show full text]
  • Tax & Value Added Tax—In View of Bangladesh
    International Journal of Tax Economics and Management Tax & Value Added Tax—In View of Bangladesh Md. Ashiquzzaman LLB, Southeast University Email: [email protected] (Author of Correspondence) Bangladesh Abstract Most developing counties are increasingly focusing on domestic resource mobilization toward economic development. In this context, tax performance is of crucial importance, especially for a developing country, since it is the prime source for domestic resource mobilization. This article reviews the incidence of income taxation in Bangladesh tax system. The main purpose of the study is to determine how the burden of personal and corporation income taxes is allocated among taxpayers of different income groups. Bangladesh faces many problems in raising sufficient tax revenues to fund its economic and social development. To address this problem and to improve economic efficiency and growth, a major tax reform program was initiated in 1991 which centered on the introduction of a value-added tax (VAT) to replace a range of narrowly-based consumption taxes. This study works as a linkage between theory and practice on Value Added Tax. In this Article focus on the tax, Value added tax, tax in history, definition, collecting problem, advantage, and disadvantage. Keywords: Tax; NBR; Value Added Tax; Social; Corporate; Economy; Government; Bangladesh. ISSN Online: 0000-0000 ISSN Print: 0000-0000 38 1. Introduction The term ‘tax’ has been derived from the French word ‘taxe’ and etymologically, the Latin word ‘taxare’ is related to the term ‘tax’ which means ‘to charge’. ‘Taxes are compulsory payment to govt. without expectations of direct return in benefit to the tax payer’. [P.
    [Show full text]
  • Tobacco Tax Administration
    WHO TECHNICAL MANUAL ON Tobacco Tax Administration WHO TECHNICAL MANUAL ON Tobacco Tax Administration WHO Library Cataloging-in-Publication Data WHO technical manual on tobacco tax administration 1. Taxes. 2. Tobacco industry – legislation. 3.Tobacco – economics. 4. Smoking – prevention and control. I. World Health Organization. ISBN 978 92 4 156399 4 (NLM classification: WM 290) Reprinted with executive summary, 2011 © World Health Organization 2010 All rights reserved. Publications of the World Health Organization can be obtained from WHO Press, World Health Organization, 20 Avenue Appia, 1211 Geneva 27, Switzerland (tel.: +41 22 791 3264; fax: +41 22 791 4857; e-mail: [email protected]). Requests for permission to reproduce or translate WHO publications – whether for sale or for noncommercial distribution – should be addressed to WHO Press, at the above address (fax: +41 22 791 4806; e-mail: [email protected]). The designations employed and the presentation of the material in this publication do not imply the expression of any opinion whatsoever on the part of the World Health Organization concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries. Dotted lines on maps represent approximate border lines for which there may not yet be full agreement. The mention of specific companies or of certain manufacturers’ products does not imply that they are endorsed or recommended by the World Health Organization in preference to others of a similar nature that are not mentioned. Errors and omissions excepted, the names of proprietary products are distinguished by initial capital letters.
    [Show full text]
  • Relationship Between Tax and Price and Global Evidence
    Relationship between tax and price and global evidence Introduction Taxes on tobacco products are often a significant component of the prices paid by consumers of these products, adding over and above the production and distribution costs and the profits made by those engaged in tobacco product manufacturing and distribution. The relationship between tax and price is complex. Even though tax increase is meant to raise the price of the product, it may not necessarily be fully passed into price increase due to interference by the industry driven by their profit motive. The industry is able to control the price to certain extent by maneuvering the producer price and also the trade margin through transfer pricing. This presentation is devoted to the structure of taxes on tobacco products, in particular of excise taxes. Outline Tax as a component of retail price Types of taxes—excise tax, import duty, VAT, other taxes Basic structures of tobacco excise taxes Types of tobacco excise systems Tax base under ad valorem excise tax system Comparison of ad valorem and specific excise regimes Uniform and tiered excise tax rates Tax as a component of retail price Domestic product Imported product VAT VAT Import duty Total tax Total tax Excise tax Excise tax Wholesale price Retail Retail price Retail & retail margin Wholesale Producer Producer & retail margin Industry profit Importer's profit price CIF value Cost of production Excise tax, import duty, VAT and other taxes as % of retail price of the most sold cigarettes brand, 2012 Total tax
    [Show full text]
  • Tax Compliance in Immigrant Communities
    Tax Compliance in Immigrant Communities: Bangladeshis in the UK Submitted by Md Zakir Hossain Akhand to the University of Exeter as a thesis for the degree of Doctor of Philosophy in Accountancy In March 2018 This thesis is available for Library use on the understanding that it is copyright material and that no quotation from the thesis may be published without proper acknowledgement. I certify that all material in this thesis which is not my own work has been identified and that no material has previously been submitted and approved for the award of a degree by this or any other University. (Signature) ……………………………………………………………………………………… 1 Abstract This thesis employs Bourdieu’s theory of practice to explore small immigrant business owners’ adaptation to the host country’s income tax system. In doing this, the thesis applies a sociological perspective in the theorizing and study of their tax compliance behaviour. Drawing on a survey (N=101) and in-depth interviews (N=27) with Bangladeshi family business owners and their tax advisers in the UK, this thesis demonstrates that immigrant business owners’ engagement with the host country’s tax system is grounded in the sociocultural status they inherit from their country of origin, even though their social class positions in the new society unconsciously condition and impact on how they practise tax compliance. Findings suggest that the power relations inherent in the tax professional-taxpayer relationship act as a critical factor in the reproduction and transformation of immigrant business owners’ moral disposition towards compliance with tax laws. The thesis argues that the ways small Bangladeshi family business owners think, feel and act in their approach to tax compliance is likely to differ not only from those of native business communities but also from those of other immigrant communities in the UK.
    [Show full text]
  • ACEA Tax Guide 2018.Pdf
    2018 WWW.ACEA.BE Foreword The 2018 edition of the European Automobile Manufacturers’ Association’s annual Tax Guide provides an overview of specific taxes that are levied on motor vehicles in European countries, as well as in other key markets around the world. This comprehensive guide counts more than 300 pages, making it an indispensable tool for anyone interested in the European automotive industry and relevant policies. The 2018 Tax Guide contains all the latest information about taxes on vehicle acquisition (VAT, sales tax, registration tax), taxes on vehicle ownership (annual circulation tax, road tax) and taxes on motoring (fuel tax). Besides the 28 member states of the European Union, as well as the EFTA countries (Iceland, Norway and Switzerland), this Tax Guide also covers countries such as Brazil, China, India, Japan, Russia, South Korea, Turkey and the United States. The Tax Guide is compiled with the help of the national associations of motor vehicle manufacturers in all these countries. I would like to extend our sincere gratitude to all involved for making the latest information available for this publication. Erik Jonnaert ACEA Secretary General Copyright Reproduction of the content of this document is not permitted without the prior written consent of ACEA. Whenever reproduction is permitted, ACEA shall be referred to as source of the information. Summary EU member countries 5 EFTA 245 Other countries 254 EU member states EU summary tables 5 Austria 10 Belgium 19 Bulgaria 42 Croatia 48 Cyprus 52 Czech Republic 55 Denmark 65 Estonia 79 Finland 82 France 88 Germany 100 Greece 108 Hungary 119 Ireland 125 Italy 137 Latvia 148 Lithuania 154 Luxembourg 158 Malta 168 Netherlands 171 Poland 179 Portugal 184 Romania 194 Slovakia 198 Slovenia 211 Spain 215 Sweden 224 United Kingdom 234 01 EU summary tables Chapter prepared by Francesca Piazza [email protected] ACEA European Automobile Manufacturers’ Association Avenue des Nerviens 85 B — 1040 Brussels T.
    [Show full text]
  • Mobilization of Resources for Sustainable Economic Development CONTENTS
    April-June 2010 The Bangladesh Accountant Bangladesh The 67 Vol. 2010 April-June No. 38 Mobilization of Resources for Sustainable Economic Development CONTENTS EDITORIAL April-June 2010 Vol. 67 No. 38 Mobilization of Resources for Sustainable Economic Development 01 ACCOUNTANCY Editorial Board Global Branding of Chartered Accountancy Chairman: M Farhad Hussain FCA Profession in Bangladesh 03 Dr. Jamaluddin Ahmed FCA Associate Editor: Harun Mahmud FCA Role of Chartered Accountants in the Mobilization Members of National Resources 06 Md. Abdus Salam FCA Dr Atiur Rahman Md. Shahjahan Majumder FCA Audit Committee, Independent Director, Bangladesh Perspective 08 Md Abdus Salam FCA FCS Showkat Hossain FCA BUDGET & ECONOMICS Masih Malik Chowdhury FCA Value Added Tax in Bangladesh - An Effective Way Anwaruddin Chowdhury FCA of Internal Resource Mobilization 11 ASM Nayeem FCA M. A. Baree FCA Dr. Md. Abu Sayed Khan FCA Marginal Workers’ Benefits: The Lone fat in Company’s Income Statement! 16 Md. Humayun Kabir FCA Mohammad Zahid Hossain FCA Akhter Matin Chaudhury FCA Analysis of the National Budget of Bangladesh 2010-11: Excellences and Constraints 18 Parveen Mahmud FCA • Md. Hafij Ullah Abdur Razzaque Mollah FCA • Monir Ahmmed Md. Abdur Rashid FCA • Abu Hanifa Md. Noman Bin Alam M A Baree FCA FINANCE & BANKING Md. Nurul Haque FCA Macroeconomic Situation 25 An overview of the Ministry of Finance, GOB Kazi Ehsanul Huq FCA A Comparative Analysis of Interest Rate Parity and Md. Akbar Hossain FCA Sticky Price Model of Exchange Rate 36 Md. Sayeed Ahmed FCA Chowdhury Rajkin Mohsin How to Increase Tax Revenue: Improvement of Enabling Md. Jakir Hossain FCA Environment, Application of Strategic Management Approach 42 M.
    [Show full text]
  • Worldwide Estate and Inheritance Tax Guide
    Worldwide Estate and Inheritance Tax Guide 2021 Preface he Worldwide Estate and Inheritance trusts and foundations, settlements, Tax Guide 2021 (WEITG) is succession, statutory and forced heirship, published by the EY Private Client matrimonial regimes, testamentary Services network, which comprises documents and intestacy rules, and estate Tprofessionals from EY member tax treaty partners. The “Inheritance and firms. gift taxes at a glance” table on page 490 The 2021 edition summarizes the gift, highlights inheritance and gift taxes in all estate and inheritance tax systems 44 jurisdictions and territories. and describes wealth transfer planning For the reader’s reference, the names and considerations in 44 jurisdictions and symbols of the foreign currencies that are territories. It is relevant to the owners of mentioned in the guide are listed at the end family businesses and private companies, of the publication. managers of private capital enterprises, This publication should not be regarded executives of multinational companies and as offering a complete explanation of the other entrepreneurial and internationally tax matters referred to and is subject to mobile high-net-worth individuals. changes in the law and other applicable The content is based on information current rules. Local publications of a more detailed as of February 2021, unless otherwise nature are frequently available. Readers indicated in the text of the chapter. are advised to consult their local EY professionals for further information. Tax information The WEITG is published alongside three The chapters in the WEITG provide companion guides on broad-based taxes: information on the taxation of the the Worldwide Corporate Tax Guide, the accumulation and transfer of wealth (e.g., Worldwide Personal Tax and Immigration by gift, trust, bequest or inheritance) in Guide and the Worldwide VAT, GST and each jurisdiction, including sections on Sales Tax Guide.
    [Show full text]
  • Informal Taxation Systems – Zakat and Ushr in Pakistan As Example for the Relevance of Parallel/Semi-Public Dues
    Munich Personal RePEc Archive Informal taxation systems – Zakat and Ushr in Pakistan as example for the relevance of parallel/semi-public dues Lorenz, Christian 2013 Online at https://mpra.ub.uni-muenchen.de/51138/ MPRA Paper No. 51138, posted 03 Nov 2013 18:58 UTC Informal taxation systems - Zakat Informal taxation systems – Zakat and Ushr in Pakistan as example for the relevance of parallel/semi-public dues Christian Lorenz1 Abstract This article provides an overview of the religious background of Zakat and the organisation of the Zakat collection in several Islamic countries. Then the mandatory system in Pakistan of Zakat and Ushr is described in more detail. Zakat and Ushr are spent mainly on much targeted areas like social welfare, education and health care for certain population groups. Other types of public goods and services are not covered with funds received from Zakat. Hence, the question arises, whether an Islamic state is according to the Islamic laws entitled to collect additional revenues like taxes in addition to Zakat. A second question is answered in the text, in how far an engagement of religious leaders in tax reform activities is in line with the Islamic law and can contribute to development activities. Taking into account the cultural and religious factors and actors, the involvement of Mullahs or Friday prayers to promote tax morale requires the support of religious scholars, but might have broader impacts even than governmental activities on the public awareness. To answer both questions it is important that - according to important religious scholars - the Islamic state requires additional revenues to cover all necessary demands of its population.
    [Show full text]
  • ENVIRONMENTAL FISCAL REFORMS in BANGLADESH Sadiq Ahmed Policy Research Institute Dhaka July 2018 Table of Contents
    ENVIRONMENTAL FISCAL REFORMS IN BANGLADESH Sadiq Ahmed Policy Research Institute Dhaka July 2018 Table of Contents List of Tables .............................................................................................................................................. i List of Figures ........................................................................................................................................... ii List of Boxes ............................................................................................................................................. ii Executive Summary ................................................................................................................................. iii Environmental Fiscal Reforms in Bangladesh ........................................................................... 1 A. Development Context ...................................................................................................................... 1 B. Rationale and Potential Role of Environmental Fiscal Reforms for Green Growth ........................ 2 C. Implementation of Environmental Fiscal Reforms: The Lessons of International Experience ....... 5 D. Current Fiscal Policies for Environmental Management Bangladesh ............................................. 8 Taxes on extraction of natural resources ......................................................................................................... 8 Prices and user fees for environmentally sensitive public services ..............................................................
    [Show full text]
  • Raising Cigarette Excise Tax to Reduce Consumption in Low-And Middle
    Ho et al. BMC Public Health (2018) 18:1187 https://doi.org/10.1186/s12889-018-6096-z RESEARCHARTICLE Open Access Raising cigarette excise tax to reduce consumption in low-and middle-income countries of the Asia-Pacific region: a simulation of the anticipated health and taxation revenues impacts Li-Ming Ho1, Christian Schafferer2, Jie-Min Lee3*, Chun-Yuan Yeh2 and Chi-Jung Hsieh4 Abstract Background: According to the World Health Organization (WHO), 80% of the world’s smokers live in low- and middle-income countries. Moreover, more than half of the world’s smoking-addicted population resides in the Asia-Pacific region. The reduction of tobacco consumption has thus become one of the major social policies in the region. This study investigates the effects of price increases on cigarette consumption, tobacco tax revenues and reduction in smoking-caused mortality in 22 low-income as well as middle-income countries in the Asia- Pacific region. Methods: Using panel data from the 1999–2015 Euromonitor International, the World Bank and the World Health Organization, we applied fixed effects regression models of panel data to estimate the elasticity of cigarette prices and to simulate the effect of price fluctuations. Results: Cigarette price elasticity was the highest for countries with a per capita Gross National Income (GNI) above US$6000 (China and Malaysia), and considerably higher for other economies in the region. The administered simulation shows that with an average annual cigarette price increase of 9.51%, the average annual cigarette consumption would decrease by 3.56%, and the average annual tobacco tax revenue would increase by 16.
    [Show full text]
  • Destination Bangladesh[English]
    Destination Bangladesh August 2019 Destination Bangladesh | PwC 1 Table of contents Foreword .............................................................................................................. 3 Chapter 1: Doing business in Bangladesh: Expanding gateways ....................... 4 Chapter 2: Entering the Bangladesh market, funding opportunities and incentives to draw foreign investments .............................................................. 12 Chapter 3: Regulations for operating in Bangladesh ......................................... 21 Chapter 4: Steps to set up business operations ................................................ 27 Chapter 5: The way forward ............................................................................... 32 2 PwC | Destination Bangladesh Foreword Bangladesh as an investment destination Bangladesh’s economy has witnessed steady growth in the past Bangladesh is already being recognised as a thriving investment decade, with the country’s annual gross domestic product (GDP) hub, and this is reflected in the country’s foreign direct investment growth rate at 7.86% in 2018. It is poised to increase by 7% on (FDI) inflows. Bangladesh’s FDI stood at USD 2.58 billion at the an average till 2033, according to a forecast by the Centre for end of June 2018. According to the Bangladesh Investment Economics and Business Research (CEBR). Development Authority (BIDA), there was 13.34% growth in FDI in the third quarter of 2018, with proposals worth USD 3.23 billion With a rising per capita income and a growing middle-class in the basket. The government’s mega projects were viewed as population, there has also been a notable increase in domestic the primary reason for drawing substantial FDI investments in consumer demand. This is a positive sign, as increased domestic the transport, storage and communications sectors. Besides consumption reflects a certain insulation of the country’s domestic consumption, exports from the country are also thriving.
    [Show full text]