Telecom Regulation: Tax

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3Q 2012 | IN-1014358


Prospective Tax Cut in Brazil


After surveying the impact of spectrum mortgage as proposed in India, we cast our eyes on Brazil for another policy matter: tax. This essay explores some unexamined issues. 

The Discussion So Far


Essentially, the Communications Minister of Brazil is concerned with the following:

“Excessive” taxes that amount to “38% of mobile phone bills”

“Distortion” as a result of higher taxes on prepaid services (52% of phone bills) than postpaid (21%)

By reducing taxes, the government aims to promote spending, thereby stimulating the economy. Of course, it is well aware of the trade-off involved between macroe...

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