FG expects to raise N160 billion through call and data tariffs.

FG expects to raise N160 billion through call and data tariffs.

Excise taxes on telecommunication services will bring in roughly N160.46 billion for the federal government in 2023. 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. However, the figure makes the assumption that the telecoms' revenue will remain constant. However, it might actually be greater or lower depending on the state of the economy in 2022. The federal government recently announced plans to impose a 5% excise fee on all telecom services provided within the country.

During a stakeholders' forum on the implementation of excise duty on telecommunications services in Nigeria, the Minister of Finance, Budget, and National Planning, Zainab Ahmed, disclosed this.

The installation of the excise charge, according to Ahmed, who spoke through the Assistant Chief Officer of the Ministry, Mr. Frank Oshanipin, was done in an effort to boost government revenue. "The tax rate was not captured in the Act," she claimed, "since the President is responsible for fixing the rate on excise charges, and he has established 5% for communications services, including GSM.

Since it is well known that our income cannot cover all of our debts, we must turn our focus to sources of income other than oil. We are all responsible for raising money to fund the government.

The additional 5% tax will be borne by telecom users, according to Gbenga Adebayo, Chairman of the Association of Licensed Telecom Owners of Nigeria. The finance minister said at the event that the tax will go into effect soon, but since then, there have been questions over whether the excise duty will really go into effect.

Isa Pantami, the minister of communications and the digital economy, declared on Monday that he opposed the levy and would do all in his power to prevent its introduction. He claimed that the telecom sector was already contributing significantly to the nation's revenue creation and that any additional attempts to expand it might have a detrimental effect.

He said, "The ministry of communications and digital economy is not satisfied with any effort to introduce excise duty on telecommunication services," at the inaugural Nigerian Telecommunications Indigenous Content Expo, which was organized by the Nigeria Office for Developing the Indigenous Telecom Sector.

"We will work behind the scenes to oppose any legislation that will obliterate the digital economy sector," he continued, "in addition to making our viewpoint known publicly.

To lawfully and legally protect its interest, we shall do everything is necessary. The cost of the levy will presumably be passed on to customers of telecommunications services. Ajibola Olude, the Chief Operating Officer of the Association of Telecommunications Companies of Nigeria, responded to the potential revenue the Federal Government would get by saying, "I don't see the Federal Government imposing the five percent excise charge.

"The idea was criticized by the Minister of Communications and Digital Economy since it didn't follow the proper procedures.

Before enacting that 5% excise levy, there are established rules. The nation's current macroeconomic conditions are another reason why I don't see it being implemented. Prices have not been stable, therefore if they implement it, crime will increase.

The COVID-19 outbreak prevented the government from enforcing the tax as intended in 2020, according to Adeolu Ogunbanjo, President of the National Association of Telecoms Subscribers, who was present at the meeting when the application of the excise charge was discussed.

Fri, Aug 2022     6

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