• Operators seek removal of taxes totaling 215 billion ariary

• Government refuses and warns of sanctions without compromise

• High mobile Internet costs remain above the ITU affordability threshold

In Madagascar, the government and telecom companies are locked in a dispute over lowering Internet costs. Operators are calling for the removal of several taxes whose combined value is about 215 billion ariary (around $47.6 million). The government refuses to concede and is demanding compromise from operators, warning of possible sanctions.

In a recent special broadcast on public channels, Mahefa Andriamampiadana, Minister of Digital Development, Posts and Telecommunications, detailed the taxes targeted by operators: excise duty, the mobile transaction tax, and taxes applied to phones costing less than $100. Their total weight is estimated at just over 11 % of the sector’s overall revenue, or about 1 938 billion ariary in 2024.

According to Iouri Garisse Razafindrakoto, Secretary-General at the Ministry of Economy and Finance, removing these taxes would directly affect the state budget, particularly allocations for education and health. He added that the draft law is already under review and cannot be amended at this stage. The loss of these revenues could not be offset to cover planned spending.

Local outlet 2424.mg reports growing pressure on social media targeting the country’s three main telecom operators (Yas, Airtel, and Orange), calling for lower Internet tariffs. At the end of October, the Communication Technology Regulatory Authority (ARTEC) asked operators to urgently consider tariff adjustments to benefit consumers. The regulator said this follows numerous public complaints in “recent weeks” about the high cost of mobile data.

ARTEC added that this move “continues actions taken since late 2024,” which led to an initial adjustment of current tariffs. In October 2024, then-Minister of Digital Development Stéphanie Delmotte announced a joint initiative with operators to reduce telecom service prices. In April, authorities introduced a minimum price for 1 GB of data, raising it from $0.45 to $0.95. The government canceled it in May, arguing that data prices kept artificially high by operators did not reflect commitments made during negotiations.

Madagascar’s telecom operators have not yet issued an official statement. However, the government intends to continue negotiations until a compromise is reached, failing which sanctions will be applied as provided by law. According to Ogascar Fenosoa Mandrindrarivony, Minister of Communication and Culture, authorities even plan to open the market to more competition, as seen with Starlink’s arrival. He called on interested national and foreign operators to prepare for this possibility.

Mobile Internet spending in Madagascar represented 6.28 % of gross national income per capita in 2023, according to the International Telecommunication Union (ITU). While this is a decline from the 52 % recorded in 2014, the price remains three times higher than the ITU’s 2 % affordability benchmark. By early 2025, the country had 6.6 million Internet users with a penetration rate of 20.4 %, according to DataReportal.