Gov Imee Marcos proposes ‘lifeline’ rate for data users; removal of VAT on voice, SMS and data services

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Ilocos Norte Gov. Imee Marcos is urging the Department of Information and Communications Technology (DICT) and the National Telecommunications Commission (NTC) to seriously consider implementing a “lifeline” rate for consumers who are not heavy users of data and mobile services.

She is also proposing a package of measures to reduce the cost of phone calls, text messages, and data services so as to end the country’s record of having one of the highest mobile voice and SMS rates in Asia.

“A ‘lifeline’ rate which could be based on a consumer’s average data and mobile use would benefit mostly lower income Filipinos,” the governor said. “The poor sectors of our society use the internet less frequently than the ‘techie’ ones, hence they should not be burdened with high cell phone charges that they did not actually incur.”

Marcos urged the government to remove the value-added tax on telecommunication services, such as phone calls and data subscriptions, and to eliminate the interconnectivity fees between telco firms.

“Removing the VAT on cellular and data subscriptions will substantially bring down the cost of communications in the country to benefit our people, especially those engaged in business and those whose relatives are working abroad and who rely heavily on cellular phone calls and the internet to communicate with their loved ones as often as they can,” she explained.

Marcos also proposed the elimination of network connectivity fees, where subscribers of either Globe or Smart are charged extra when they contact numbers belonging to the other network. The governor stressed that interconnectivity charges hamper customer mobility, and effectively holds subscribers hostage to their existing network plans, she said.

“Removing the network connectivity fees will not only reduce the cost of communications services, but will also improve customer mobility in the telecommunication industry as well as compel telcos to improve their services,” she said.

“If we remove interconnectivity fees, this will make it easier for a subscriber to move from one network to another if they are not satisfied with the services they are receiving from their current providers. Right now, a customer, even if extremely dissatisfied with the services of Smart or Globe, would be held back from switching to another provider by the stiff interconnection fees. Thus, telcos get away with bad service while raking in huge profits at the expense of their customers,” she explained.

“Right now, our telco companies are offering unli plans in the guise of making their services and products more affordable to Filipino customers. But is unli really unlimited? Interconnectivity fees end up as extra cost on top of your unlimited plan,” Marcos added.

“Gawin nating tunay ang sinasabi nilang (telecom firms) unlimited . . . unlimited call and text to all telecom networks. Sabi nga – sa mga nagliligawan: hindi dapat maging hadlang ang magkaibang network sa pag-iibigan,” Marcos said.

In the long-term, Marcos asserts that the elimination of interconnectivity charges and fees will drastically reduce costs of phone and data connection and force telco firms to ensure reliability of their services — a double-win situation for Filipino subscribers.

“Filipinos are paying more for services that are much worse than what can be procured elsewhere. We all end up shortchanged while telco firms rake up more and more profits,” Marcos lamented.

The DICT is currently fine tuning a proposal for a shared telco infrastructure initiative.

The common tower scheme is expected to improve connectivity by providing the necessary infrastructure for all telco firms. The Philippines has one of the lowest cell densities in Asia.