OTT tax and data prices during Covid-19 in Cameroon

Policy brief

This policy brief by Tapiwa Chinembiri and Naila Govan-Vassen demonstrates the quarterly time series trend of data prices in Cameroon between 2016 to the end of 2020, as well as how prices have reduced. The reduction does not necessarily translate to cheaper data in the country with regulators still demanding that prices ought to reduce further. Due to the COVID-19 pandemic, the service providers have intervened to ease prices to enable access to information, news and updates relating to the pandemic. However, this comes after the introduction of a tax on mobile application downloads from which consumers are still smarting. 

Tax revenue is vital for any country for infrastructure development and service delivery. However, the introduction of the mobile application downloads tax will increase the cost of accessing the internet, especially in countries where data affordability is a challenge for most of the population. These taxes are counterproductive in that they tend to undermine efforts to bring more Cameroonians online, disincentivise use and reduce the available spend for data, resulting in a drop in demand for data, and leading to reduced data revenues for mobile operators. If the demand for data decreases, there will be fewer people using social media, thus lowering taxable take and most likely leading to a decline in government revenue from the telecommunications sector. This policy brief argues that it is unlikely that tax imposition efforts on application downloads will succeed in Cameroon.

Suggested citation

Chinembiri, T., & Govan-Vassen, N. (2021). OTT tax and data prices during Covid-19 in Cameroon – Research ICT Africa [Policy Brief].