Mali’s New Mobile Tax Sparks Debate Amid Security Crisis

Mali’s government has introduced new taxes on mobile services as it seeks to boost revenue for security efforts. The decision comes at a time when the country is grappling with increasing insurgent threats and a decline in international financial support. While the authorities argue that the move is necessary to fund security operations, critics fear it will deepen the financial burden on ordinary Malians.

Since General Assimi Goïta led a military coup in 2020, the country has faced escalating militant attacks, straining its relationships with Western allies like France and the U.S. As a result, Mali has lost over 400 billion CFA francs ($628 million) in budget support, Prime Minister General Abdoulaye Maïga stated. With fewer external funding sources, the government has turned to domestic taxation, but at what cost?

Impact on Citizens and Businesses

For many Malians, mobile phones are not just communication tools but essential financial lifelines. Mobile money services play a crucial role in financial inclusion, especially for low-income earners and small businesses. With the new tax in place, these services may become more expensive, limiting access for those who need them most.

Economic experts warn that rising costs could lead to reduced mobile service usage, ultimately affecting economic participation and access to information. While the government’s goal is to strengthen national security, there are concerns that the move could stifle economic growth and worsen financial hardships for citizens.

Alternative Revenue Strategies

Rather than imposing new taxes, some analysts suggest Mali could explore alternative ways to fund its security initiatives. Improving tax administration, enforcing compliance, and modernising revenue collection could help boost government funds without placing additional financial strain on the public.

The country’s vast natural resources, particularly in mining, also offer potential revenue streams. By ensuring better taxation and management of the sector, Mali could increase earnings without resorting to widespread consumer taxation.

A Growing Trend in Africa?

Mali’s approach reflects a broader pattern across Africa, where governments are turning to telecom and digital service taxes to bridge budget gaps. Nigeria recently proposed reintroducing telecom taxes to secure a $750 million World Bank loan, despite concerns from telecom operators. Meanwhile, Kenya’s Treasury has suggested raising mobile airtime and data taxes from 15% to 20% as part of efforts to generate $2.5 billion in additional revenue.

As Mali navigates its security and economic challenges, the key question remains: can the government balance revenue generation with economic stability, or will citizens bear the brunt of these new financial pressures?