The previous Awami League regime, which touted its efforts to make Bangladesh digital, mirrored the poor farmer in Aesop's fable of the golden goose when dealing with the mobile voice and internet sectors. The interim government is now replicating this flawed approach following its predecessor's footsteps.

Just as the farmer in the fable killed the goose in a misguided pursuit of greater wealth, the government's escalating taxes on mobile internet threaten to stifle digital accessibility and growth—the modern equivalent of golden eggs.

At present, the government appears to be taking an even more detrimental path, burdening an essential sector with excessive taxes. The internet is no longer just a source of entertainment, but also crucial for financial services, education, healthcare, transportation, and freelancing opportunities.

When additional levies, such as revenue sharing and minimum taxes, are considered, the total tax burden exceeds 56.3 percent—one of the highest globally, according to industry analysts

The National Board of Revenue (NBR) increased the supplementary duty (SD) from 20 percent to 23 percent on January 9, just six months after it was raised from 15 percent. Experts warn that this move will further hinder the sector's growth.

Consumers were already paying Tk 139 for Tk 100 worth of mobile services, factoring in 15 percent VAT, 20 percent SD, and a 1 percent surcharge before the hike. Now, they must spend Tk 142 instead.

When additional levies, such as revenue sharing and minimum taxes, are considered, the total tax burden exceeds 56.3 percent—one of the highest globally, according to industry analysts.

The most alarming move by the interim government is the introduction of a 10 percent supplementary duty on broadband internet, severely undermining an ambitious plan to reduce broadband prices by up to 20 percent by Emdad ul Bari, chairman of Bangladesh Telecommunication Regulatory Commission (BTRC).

Despite rising to power after a youth-led movement, the current administration has failed to learn from the previous government's missteps like soaring internet service taxes.

The supplementary duty on mobile data and voice services was just 3 percent in FY16, which steadily climbed to the current 20 percent.

Also, the tax on SIM card sales increased to Tk 300 from Tk 200 in the last fiscal year, while doubling the VAT on SIM cards from Tk 100 to Tk 200 in 2020-21.

These arbitrary tax hikes, driven by the government's preference for mobile VAT due to its transparency and ease of collection, have had a profound impact.

Already grappling with inflation, the market suffered further, marking the fifth consecutive month of decline from July to November. During this period, internet subscribers dropped by 9.3 million.

Alongside price increases, the Awami League's over-issuance of licences in the internet ecosystem led to market oversaturation, weak regulation, and inefficiency.

Many licences were granted to unqualified entities with inadequate resources, often influenced by political preferences. This fragmented market stifled competition, limited innovation, and hindered infrastructure development, with the government's vision for a "Digital Bangladesh" remaining unfulfilled.

It initially aimed to increase ICT exports to $1 billion by 2018 and $5 billion by 2021, later extending the $5 billion target to 2025. Yet, Bangladesh's ICT exports remain stagnant at just over half a billion dollars.

In comparison, Pakistan's IT exports are more than five times higher, highlighting Bangladesh's failure to capitalise on its digital potential.

Poor internet quality, high costs, and slow digital transformation have further eroded the dream of a tech-driven economy.

Bangladesh scored 62 out of 100 in the June 2024 ICT Development Index by the United Nations International Telecommunication Union, lagging behind Myanmar, Sri Lanka, the Maldives, Vietnam, and Bhutan.

The country ranked 113th out of 174 in the IMF's Artificial Intelligence Readiness Index and dropped to 82nd out of 121 countries in the 2023 Digital Quality of Life Index by Surfshark as the internet speed was measured at 5 percent below the global average.

Freelancing, a key growth area for youth employment, is also struggling as the country ranked 29th out of 30 freelancing destinations in CEO World's April 2024 report, trailing behind South Asian peers India and Pakistan.

Bangladesh ranked 109th out of 147 countries for mobile internet speed and 108th for broadband speed in the May 2024 Ookla Speedtest Global Index, falling behind nations such as Kenya, India, and Rwanda.

While internet service providers (ISPs) and mobile operators often face criticism for subpar services, much of the blame lies with the government and the regulator.

The BTRC has issued directives that benefit a select few with close ties to the former regime. This was done under the heavy influence of the previous government's interference, creating an uneven playing field, burdening consumers with high costs, and hindering the growth of digital service providers.

Treating broadband licences like cable TV businesses was another damaging decision by the previous regime. This approach allowed local strongmen and political operatives to dominate area-based operations, making many regions inaccessible to compliant ISPs.

As a result, numerous customers remain stuck with outdated 1 Mbps broadband speeds when anything below 5 Mbps is now considered unacceptable for ISPs globally.

Developed countries regard 100 Mbps or higher as standard broadband, particularly with the expansion of fibre-optic networks. Despite the government's Tk 4,000 crore investment in fibre infrastructure, the outcomes have fallen significantly short of expectations.

This digital divide continues to widen. In the first quarter of the current fiscal year, internet usage in urban areas was nearly double that of rural regions.

Only 36.5 percent of rural individuals used the internet, compared to 71.4 percent in urban areas, according to the national statistical agency's latest survey. The recent tax hikes may exacerbate this disparity.

Digital service providers have long argued that slow and costly internet has stifled their potential with the past government bearing significant responsibility for this.

Many were hopeful of a different approach by the interim government to recognise the internet's potential to drive growth, boost the economy and solve pressing issues.

Instead, the previous government's squandering of the internet's opportunities has been compounded by the interim administration. What could have been a chance to revive this invaluable sector now risks being buried so deeply that any hope of resurrection may be lost forever?