According to a top minister in Ghana’s government, the government is considering charging the use of platforms like WhatsApp and Facebook in order to raise more cash.
According to Ursula Owusu-Ekufu, Ghana’s Minister of Communications and Digitalisation, the move is driven by a decrease in the use of traditional telecommunication services as individuals prefer to communicate over the internet, which is formally known as over the top (OTT):
Ursula explained, “As conventional sources of telecoms revenue, such as voice, diminish, the government is losing significant earnings from MNOs to OTT digital service providers.
It’s critical that we have a candid, open discussion about this and look into different revenue streams inside the digital services area to help the government better mobilize domestic money,” said Minister, Communications and Digitalisation, Ghana
An over-the-top (OTT) virtual or digital service is a media service delivered over the Internet to telecommunications users. Cable, broadcast, and satellite television systems are all bypassed by OTT.
Popular over-the-top communication services include Facebook, Whatsapp, Zoom, Telegram, and Skype.
The minister, who was apparently speaking to the Mobile Technology for Development (MT4D) team, stated that telecoms players, particularly Mobile Network Operators (MNOs), will be consulted on how the government may increase revenue by taxing OTT.
Taxes related with the use of different social media platforms are known as social media taxes. Although the amount consumers must pay in taxes to gain access to social media sites may not appear to be significant, it adds to the cost of accessing the Internet.
Most will argue that the tax rate is insignificant, but this is not the situation for data customers who pay less than $0.10 per day to access the Internet! Some users rely on packaged items that provide 10 cents per day access to various social media sites.
Taxing social media diminishes the typical African’s knowledge level by making it more difficult to learn from the vast amount of information available on the Internet.
If consumers have to pay to access social media, many of them may forgo using the Internet altogether. This will exacerbate the knowledge gap between the rich and poor in Africa, slowing progress.
While the tax that users will have to pay to use social media may not appear to be a significant amount, there is always a significant difference in demand for a product when people can use it for free versus when they have to pay.
When a product’s price rises only little, it is unlikely to alter demand. However, the average African would always struggle to transition from free to paid use of a product. This holds true regardless of the cost.
Don’t miss important articles during the week. Subscribe to techbuild.africa weekly digest for updates.