As Telecoms Tax Begins, Lonestar Ends Popular Promotions and Angers Customers

MONROVIA, Montserrado – Lonestar Cell MTN has announced that it is ending its promotional packages as a result of increased taxes on phone calls, which the company lobbied to have imposed. The move has prompted widespread outrage in the country.

Some of the packages affected include the three-day call for US$1.00 program. It is not yet known what other programs will be affected, but the company said the action is in line with the government’s excise tax on domestic voice calls as of Jan. 15.

Recently, the Legislature approved an amendment to existing tax laws under the Liberia Revenue Code. The amendment subjects callers and customers to pay US$ 0.01 per minute on all calls made in the country.

The amendment was proposed in 2016 by President Ellen Johnson Sirleaf to support the 2016/2017 fiscal budget. Increased excise tax on phone calls was among other amendments made.

Sirleaf called on the lawmakers to increase the excise tax on alcoholic beverages from 35 percent to 45 percent and to move the tobacco rate from 35 to 80 percent. She also proposed adjusting the Goods and Services Tax from seven to ten percent.

These actions, she said, were to provide incentives for additional investment in the economy and would contribute revenues of US$ 30 million to support the national budget.

Before a hearing by the Joint Committee on Ways, Means, Finance, and Development Planning of the Liberian Senate and the House of Representatives in July last year, Lonestar Cell MTN was the company that supported the proposal of the tax increment and promised to bear the responsibility without passing the cost to the consumers.

Many other businesses rejected the amendments to increase the excise tax on phone calls, tobacco, alcoholic, and non-alcoholic beverages.

Cellcom, the Liberia Coca-Cola Bottling Company, Monrovia Breweries, the Water Producers of Liberia and the Tobacco Association of West Africa were among those that took exception to the amendments.

According to them, the tax increment would not only affect production and sales, but it would also encourage redundancy, unemployment, and poverty.

Meanwhile, Cellcom and Novafone, which is now owned by Lonestar, have not announced any adjustment in the cost of their services or promotional campaigns.

Since Lonestar cut off its three-day campaign on Sunday, social media has seen a mixed but mostly negative reaction from customers. A number of subscribers have expressed disappointment in the action of their service provider. For them, unsubscribing from Lonestar is the only option.

“Cellcom, here I come, Lonestar has bid me goodbye,” one Facebook user wrote on her timeline, referring to Lonestar’s biggest competitor.

Some customers, however, are blaming the government, especially lawmakers, for not acting in the interest of their people. Several individuals have suggested voting lawmakers out of office during the upcoming elections.

“The protest should not be against the Lonestar phone company. It should be against every member of the legislature who voted for the tax hike,” another Facebook user wrote. “Liberian people have a means of paying them back on October 10 this year. Voting out all of them will be a very strong message. People who don’t pay phone bills should be told in no uncertain terms that the average person will not take kindly to them passing a law to make calls more expensive.”

For the 2015/2016 fiscal year, representatives each received US$13,800 as an allowance for telecommunications expenses while each senator received US$17,000.

A Facebook user, angry at lawmakers, wrote, “Those guys don’t mean business, and that is why we should register to show them the exit door on October 10.”

At the same time, some believe both the phone company and the government must be criticized, including one Facebook user who said he would still keep using Lonestar.

“Lonestar cell remains my primary GSM company. Our lawmakers who are public officials work in too much secrecy, which runs contrary to their role as public officials,” he wrote. “On the other hand, Lonestar’s response to said tax increase is at the extreme. Deducting money from service users when you claim to quit the promotion is unacceptable. I am a primary victim.”

Indeed, much of the annoyance from Lonestar users stems from accusations that despite the elimination of the promotions, the company still deducted money from unaware users without rendering the service.

Featured photo by Lonestar Cell MTN

Gbatemah Senah

Senah is a graduate of the University of Liberia and a recipient of the Jonathan P. Hicks Scholarship for Mass Communications. Between 2017 and 2019, he won six excellent reporting awards from the Press Union of Liberia. They include a three-time Land Rights Reporter of the Year, one time Women's Rights Reporter of the Year, Legislative Reporter of the Year, and Human Rights Reporter of the Year.

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