South Africa Eyes Smartphone Tax Cuts Ahead of 2G/3G Shutdown
10:02 13.11.2024 (Updated: 10:23 13.11.2024)
© AP Photo / Stephanie Scarbrough
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South Africa's Next Generation Radio Frequency Spectrum Policy dictates the shutdown of 2G and 3G networks, with certification of 2G/3G-only devices banned from September 30, 2024, and activation banned from December 31, 2024. Services will be shut down starting June 1, 2025, with full network closure on December 31, 2027.
South Africa is considering tax cuts on smartphones to make them more affordable ahead of the planned shutdown of 2G and 3G networks, the country's Communications Minister Solly Malatsi said, noting that initial talks with the Treasury on the matter are promising.
However, the government's plan to shut down older networks by December 31, 2027, as outlined in the Next Generation Radio Frequency Spectrum Policy paper, faced criticism for potentially widening the digital divide. Critics argue that many low-income people, especially in rural areas, may not be able to afford new smartphones compatible with faster 4G and 5G networks.
"Our proposal is that the ad valorem tax contributes to the high cost of smart devices. When you eliminate that cost, it will help drive down affordability, and that's my key interest," Malatsi said, noting that preliminary engagements with Treasury about that had already been held.
South Africa's high taxes on smartphones, including a luxury excise tax, are making devices more expensive. Telecom operators and industry groups are urging the government to reduce these taxes and avoid a strict deadline for the 2G/3G shutdown to ensure a smooth transition to faster networks.
