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South African smartphone prices could increase  year

South African smartphone prices could increase year

CAPETOWN: As part of its ‘cost to communicate’ representations at Icasa towards the end of March, South Africa’s largest communications companies outlined their plans to further reduce data costs in the country, and the measures they had already implemented to reduce these costs.

One of the most notable measures was in MTN’s presentation where the company stated that it had paid over R570 million on subsidising ‘ad valorem duties’ when bringing devices into the country.

While an impressive sum, this amount of money is unlikely to go as far in the coming years, with National Treasury stating that it plans to increase the tax on luxury goods as part of the 2018 budget – with a specific classification for smartphones.

“Effective 1 April 2018, the maximum ad valorem excise duty for motor vehicles will be increased from 25% to 30%, and the classification of cellular telephones will be updated to include smartphones to ensure they attract ad valorem excise duties,” the 2018 budget review states.