GSMA urges African smartphone tax cuts to unlock 961m users
The mobile industry body is pressing African governments to scrap levies on low-cost devices, warning that high taxes are blocking a 961 million-person market from accessing digital and AI services.
The GSM Association (GSMA) has called on African governments to eliminate taxes and levies on entry-level smartphones to close a massive usage gap on the continent. Speaking at a digital summit in Abuja on Wednesday, the industry body warned that fiscal barriers are preventing 961 million people from using mobile broadband services despite living in covered areas.
For telecom operators and device manufacturers, this gap represents a vast, untapped revenue pool. Mobile technologies currently contribute $240 billion to Africa’s economy, support 13 million jobs, and generate $45 billion in sector revenues, according to the African Telecommunications Union. Expanding the user base is critical for telecoms seeking new subscriber growth as urban markets mature.
Device costs limit market reach
The primary bottleneck is hardware affordability. Caroline Mbugwa, GSMA’s Senior Director of Public Policy for Africa, noted that while network coverage has expanded, the upfront cost of smartphones keeps consumers on legacy feature phones. She pointed to South Africa as a proof of concept, where removing a 9% luxury tax on low-cost devices successfully drove smartphone adoption.
“AI is dependent on ensuring that smartphones are available and affordable to all Africans,” Mbugwa said. Limiting access to affordable devices threatens to lock millions out of the digital economy, restricting market opportunities in education, healthcare, and transport sectors.
Infrastructure and regulatory drag
Physical infrastructure presents another cost hurdle. Roughly 9% of Africa’s population remains outside broadband coverage, with rural deployments costing two to five times more than urban builds while yielding lower returns. To offset these costs, GSMA is pushing for technology-neutral regulations that allow operators to integrate satellite services into their networks.
Regulatory inefficiencies are further squeezing industry margins. Michaela Angonius, GSMA’s Head of Policy and Regulation, criticized the chronic underuse of Universal Service Funds. “When funds are collected but not used, it becomes an extra tax on the industry, and this eventually affects end-user prices,” she said.
Angonius urged policymakers to abandon rigid, technology-specific licensing in favor of unified frameworks. Allowing satellite and terrestrial providers to compete under similar rules would accelerate network expansion. “Technology is moving very fast today, and regulations need to keep pace,” she added.
To support broader digital adoption, GSMA also announced an AI Atlas initiative designed to integrate African languages, including Nigerian dialects, into artificial intelligence systems. The program aims to ensure that as regulatory barriers fall and connectivity expands, localized AI tools are ready for the next wave of users.
