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  • Updated: August 11, 2022

Center Says FG Should Abandon Plans To Raise Excise Charge On Telecom Services

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Lawrence Agbo
Lawrence Agbo

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An NGO named the Centre for Information Technology and Development (CITAD) has advised the Federal Government to abandon its plans to increase telecom services by 5.5%.

The Minister of Finance, Budget, and National Planning, Zainab Ahmed hinted at the ministry's intention to raise the excise duty on telecommunication services from the present level of 5.5% to increase income during a stakeholders' meeting.

Prof. Yahuza ZakariYa'u, the executive director of NITAD, warned news reporters in Kano that the hike would be difficult for Nigerians.

Therefore, ZakariYa'u pleaded with President Muhammadu Buhari to drop the increase's proposal.

In addition, he urged the President of Nigeria, Muhammadu Buhari, to initiate the process of creating a National Policy on Community Networks so that communities may address problems with their infrastructure.

”We find this unacceptable as it will not only create more hardship for Nigerians but also more fundamentally undermine the economic recovery of the country.

“The effect of the proposed increase is to make calls and data more costly in the context in which already Nigerians are paying heavily for this.

”Nigeria is one of the countries with a low affordability index as calculated by the Alliance for Affordable Internet,” ZakariYa’u said.

The director further noted that just 46% of Nigerians currently have access to the complete range of telecommunications services, with many others unable to afford both the cost of access and the cost of use.

“This means that more than half of Nigerians are not able to do so for several reasons, chiefly among which is their inability to afford both the cost of access and cost of use.

"Nigeria does not manufacture telecommunication equipment and devices so it can hardly bring the

According to ZakariYa'u, Nigeria aims to reach 95% broadband penetration by 2030 and 95% digital literacy by 2025.

The finance minister predicted that in 2023, excise taxes on communications services will bring in roughly N160.46 billion for the federal government.

The Nigerian Communications Commission estimates that in 2021, the combined income of GSM, Fixed Wired, and Internet Service Provider providers will be N3.21 trillion.

The government would generate roughly N160.46 billion if it implemented its 5% excise levy on telecom services.

The Minister of Communications and Digital Economy, Prof. Isa Pantami, reportedly opposed the latest proposal to impose a 5% excise fee on telecommunication services, according to NAN.

When put into effect, according to Pantami, this will raise the overall tax that users of telecom services pay to 12.5%.

He claimed that the telecom industry already makes a significant contribution to the Nigerian economy and that raising taxes could harm its expansion.

Pantami encouraged the government to take into account taxing other economic sectors that aren't aiding in the growth of the country.

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Lawrence Agbo
Lawrence Agbo

Lawrence is a vibrant digital journalist that loves creating SEO-focused content that drives busines...

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