Ammon News - Shop owners say retailers, customers confused about actual prices

by Mohammad Ghazal/ Jordan Times

AMMAN — Sales of prepaid cards and mobile lines dropped by about 15 per cent after the government increased taxes on cell phones and subscriptions, mobile shop owners said Monday.

They noted that their business slowed down after the increase in taxes, as demand by customers on prepaid cards dropped since July 11 when the special tax on mobile phones went up from 8 per cent to 16 per cent, and the tax on mobile subscriptions — both prepaid and post-paid — rose from 12 per cent to 24 per cent.

"I usually sell around 100 prepaid cards of all categories a day. But since the government increased taxes, I have been selling about 80 or even less sometimes," Adel Khalil, a shop owner, told The Jordan Times.

"The increase in taxes negatively affected our business because people are not buying prepaid cards as before… some of my customers used to carry three mobile phones but now they only use one," Khalil noted.

The mobile shop owners said the sudden increase in taxes floated the prices of mobile lines and prepaid cards, causing confusion for both retailers and customers.

"There is no fixed price for prepaid cards nowadays. It all depends on the distributors," said an employee at a grocery store in downtown Amman.

"After the tax increase, I bought a prepaid card of the JD5 category for JD7.15 and I sold it for JD7.25. Then the distributor increased the price to JD7.3 and I started selling it for JD7.5. Shops sell prepaid cards at different prices now," said the employee, who identified himself as Issa.

Ahmad Hanandeh, CEO of Zain Jordan, tweeted this week that sales of the company's prepaid cards have dropped by about 10-15 per cent per day since the taxes went up.

In his tweet, Hanandeh said he expected sales to by about JD113 million annually because of the decision to hike taxes.

Mobile shop owners said prices of SIM cards have also increased from JD1.5 to JD2 on average, while some shops sell mobile lines for more than JD3.

There were 9.475 million mobile subscriptions in Jordan by the end of March. Of the total, about 8.745 million are prepaid card subscriptions, according to figures released by the Telecommunications Regulatory Commission.

Nidal Elhajj, an employee at a textile company, said he will stop recharging his two mobile lines due to the increase in prices of prepaid cards.

"I used to carry two mobile lines; one is Zain and the second is Umniah. But I can no longer afford both. I had two SIMs because of the good offers by the telecom companies. One was mainly for the Internet and the second for making calls," Elhajj explained.

"I will only use the mobile line with the Internet subscription and stop recharging the second one. I guess I will keep it for receiving calls until it is disconnected," he said.


Prepaid cards prices before and after the increase in tax, according to mobile shops: