FG to Impose 5% on Telecom Services, as Revenue continues to Drop

The Federal Government of General Muhammadu Buhari has announced that it would be implementing a 5% tax on telecommunication services.

This was disclosed by Finance Minister, Zainab Ahmed at the stakeholders’ forum organised by the Nigerian Communications Commission, NCC in Abuja on Thursday.

Ms. Ahmed said this was necessary in order to cushion the effect of the fall in the country’s income due to dwindling oil prices.

“The issue of revenue is not something that need to be shy away from, our revenue can no longer take care of our needs as a country,” Ms Ahmed said.

Ms. Ahmed Zainab, Minister of Finance.

“Also Nigeria is no longer making enough money in oil revenue hence the attention is shifting to non-oil revenue.”

The Minister who was represented by Musa Umar, the Assistant Director, Tax and Policy of the Ministry, said in their defence that African nations, including Malawi, Tanzania, Uganda, and others have already implemented this as a way of generating revenue.

Reacting to the new development, Engr Gbenga Adebayo, Chairman of the Association of Licensed Telecommunications Operators of Nigeria(ALTON), said the subscribers will be the ones to shoulder the weight of the new tax policy.

“It is a strange move, it appears a bit unusual. Excise duty is supposed to be apportioned to goods and products, but we are surprised this is on services,” he said.

“We currently pay a lot of taxes, running into 39 of them, so we can’t add more to the our existing burden. We won’t be able to absolve this on behalf of subscribers. The five per cent excise duty will be paid by the subscribers. It will collected by the operators on all voice and data services including OTT and remitted to the Nigerians Customs”, he added.

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