Digitel’s 3G investments, however, will not be entitled to the income tax holiday (ITH) incentive after the government consolidated its fiscal policy, considering that the telecom firms’ operations are already profitable.
Digitel is spending P6.307 billion over a three-year period for its 3G services which will be available by June next year.
Digitel’s 3G network will require a data-centric model rather than a voice-centric model as used by the current first generation and second generation networks.
Globe had been the first to apply with the BOI, followed by Smart. Their initial applications were supposed to enjoy ITH incentives but these perks earned the ire of Congress which demanded that the profitable telcos lower the cost to subscribers.
Smart was planning to invest P33.178 billion for its 3G expansion, but following the removal of the ITH incentive, Smart has decided to reduce its planned investment.
Globe, on the other hand, is spending P5.48 billion for its 3G infrastructure investment.
The 3G technology will allow subscribers to enjoy video services, faster mobile Internet connection and a host of other advanced content and applications.