• Operators say tax reductions are needed before lowering Internet prices
• Industry cites heavy sector taxes, rising costs, and new untaxed competition
• Government resists removing taxes but remains open to continued talks

Madagascar’s telecom companies insist that tax relief is a prerequisite for the tariff reductions demanded by authorities. In a statement published on Tuesday, November 24, 2025, responding to a government position issued the day before, the Madagascar Telecom Operators Association (GTM) reaffirmed its stance.

Operators confirm they want the removal of “certain additional taxes recently applied to the sector or ineffective in their implementation.” These include excise duties considered luxury taxes on telecoms, the 5% tax on mobile money, and taxes on imports of affordable smartphones. They argue that these removals would not reduce public revenue, even though the government expects a shortfall of 215 billion ariarys ($47.9 million) that would affect education and health. They also note their commitment to pay 400 billion ariarys in taxes in 2026.

While the government calls for compromises from operators, the companies argue that tax relief itself is a compromise. They point to sector taxes among the highest in Africa and a sharp rise in regulatory fees in recent years, particularly for licenses and frequencies. This is compounded by a deteriorating macroeconomic environment marked by the ariary’s depreciation against the euro and rising energy costs, both from the public supplier and from backup solutions required due to power outages, along with inflation.

They also denounce “recent unfair competition from an operator that pays no fiscal or regulatory taxes and has no investment or hiring obligations, leading to illegal and untaxed resale practices.” Although the statement does not name the operator, the arrival of Starlink is one of the most significant recent changes in Madagascar’s telecom landscape. The government, meanwhile, welcomes the increased competition.

Madagascar’s telecom operators say they remain open to dialogue, as does the government. They call for the involvement of the Prime Minister and the president of the Refondation. For now, the government refuses to eliminate the taxes demanded by operators but plans to continue negotiations to reach a compromise, failing which measures will be taken according to existing regulations. Authorities also say they are ready to open the market further to new national and international players if the situation does not evolve.

In Madagascar, monthly mobile Internet expenses accounted for 6.28% of gross national income per capita in 2023, according to the International Telecommunication Union (ITU). Although this level is far below the 52% recorded in 2014, it remains three times higher than the 2% affordability threshold set by the organization. For comparison, the ratio stands at 4.48% in Africa and 1.24% worldwide. The country had 6.6 million Internet users at the beginning of the year, a penetration rate of 20.4%, according to DataReportal.