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We are making this statement in connection with specified in the article 9.3 of the renewed composition of the draft law on special fund of the Government submitted to the State Great Khural with draft budget of Mongolia of 2019 “ Capital to centralize from a legal entity, which conducts communication service, to the USOF shall be equal to 3% of net profit after tax in order to take tax of 3% from net profit after tax of business entities, which conduct activities, pay tax of 25% according to the related laws and regulations under the name to centralize capital, which does not meet with Constitution of Mongolia and is not specified in the General Taxation law.
It does not correspond with specified in the concept of renewed composition of the law on Special Fund of the Government “Shall not charge with obligation additionally to the previous obligation to a legal entity and shall not make any additional cost” and conflicts with the Constitution of Mongolia, General Taxation Law and Company law and thus we CONTEST this article.
We, mobile communication service providers, which centralize 70-90 percent of tinhe capital of the USOF regularly, have worked to introduce developmental tendency of information technology of the world not losing time, deliver product and service of advanced technology to consumers, establish fundamental infrastructure of digital transformation of other social and economic sectors and propose digital technology solution based on it in the future development of Mongolia to governmental agencies and private sector, have created over 7000 sustainable work places and have decreased service price rate year by year.
Communication service providers have made investment of MNT 1 trillion and 52.3 billion, have paid Corporate Income tax, customs and value added tax and social insurance commission according to the laws and regulation of Mongolia and taxes, commission, payment and fees fixed in other laws have centralized income of MNT 763 billion to the state budget only for latest 5 year at the sectorial level.
Comparing with the period of establishment of the fund communication sector was liberalized completely and thus. This compulsory method became unnecessary, service providers have solved independently the problem to deliver network and service in competition principle and it is completely possible to solve it furthermore. We have put demand several times to the related entities that it is necessary to clarify policy and purpose of the fund more clearly due to distinctive centralization of capital to the fund and spending not for its purpose.
Net profit of the company is A LEGAL PROPERTY OF SHAREHOLDERS after disqualifying cost from income gained from its operation and paying related taxes according to the laws and to adopt to obligate to individuals and business entities to centralize capital from “net profit”, which is legal property, to any fund is an action to directly encroach to the PRIVATE PROPERTY and thus here with we are MAKING STATEMENT to appeal to the Constitutional Court.
