Mobile firms criticise text tax plan

 

THE MOBILE phone industry has criticised a proposal by a Government TD for a tax on text messages, calling it “double taxation”.

The suggestion of a one cent tax to be introduced in the forthcoming budget was raised by Green Party deputy leader Mary White in the Dáil on Tuesday.

Ms White suggested a tax on texts would be a relatively painless and fair way of taking in money in tough times. People don’t have any regard for “brown money”, she said.

The Green Party has been considering the idea since last October’s budget. The tax could bring €146 million into the exchequer, Ms White said on RTÉ radio yesterday, revising her original estimate of €1.4 billion. The figure was based on four million people sending 10 text messages on average per day, she said.

Some 25 million text messages are sent by Irish mobile phone users each day, according to communications regulator ComReg. Based on this figure, a one cent levy on each text message would take in some €91 million in taxes annually

Minister for Health Mary Harney indicated yesterday that the tax on texts was among a range of options being considered in the forthcoming budget. “There are a lot of reliefs that have to be examined, there’s excise taxes, we’ve heard reference to text taxes, we’ve got to look at all these things,” Ms Harney said.

“We’ve got to be very innovative and very imaginative in the manner in which we approach the fiscal package that the Government have to address,” she said.

However, the Irish Cellular Industry Association has questioned the reasoning behind the proposal.

“There is no logical reason why an additional tax should be imposed on text messages as opposed to any other product like cups of tea or coffee,” the association, which represents phone companies Vodafone, O2, 3 and Meteor said in a statement.

“The reality is that consumers already pay 21.5 per cent vat on all phone calls and text messages”, it continued.

The association argued that the measure would hit the young and less well off because they use texting more.

Labour finance spokeswoman Joan Burton said the proposal was worth considering. Speaking on Newstalk’s Breakfast Show earlier this week, she said because young people would be hit by the tax, it should be earmarked for disability services and the cervical cancer vaccination.