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<Research>Citi: VAT Rate Adjustment Expected to Have ~3% Potential Impact on Service Rev. of 3 Big Telecoms
Recommend 35 Positive 56 Negative 32 |
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CHINA MOBILE (00941.HK), CHINA TELECOM (00728.HK), and CHINA UNICOM (00762.HK) announced that, starting from 1 January 2026, the tax item originally applicable to 'value-added telecommunication services' will be adjusted, Citi Research issued a research report saying. The affected services include mobile data traffic services, SMS, MMS services and internet broadband connection services using wireline network, mobile network, satellite or the internet. These services will be reclassified as basic telecommunications services, and the applicable VAT rate will be raised from 6% to 9% accordingly. Citi believed that, given market competition and stable demand, operators are unlikely to pass the higher tax burden onto consumers by adjusting data tariff plans. Therefore, this adjustment may have approx. a 3% potential impact on their service revenue, which constitutes a major part of their revenue. AASTOCKS Financial News Website: www.aastocks.com |
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