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Operators kick over five per cent telecoms tax implementation

Telecommunications companies yesterday kicked against the implementation of the 2022 Fiscal Policy Measures and Tariff Amendments which provided that they pay five per cent as excise duty for services provided.

They rejected the tax, describing it as insensitive, unfair and capable of crippling the industry in the way and manner the oil industry has been crippled by different challenges.

According to them, the industry is already saddled with over 39 different taxes, and the present one being proposed for implementation would only send the telecoms sector into coma.

The industry stakeholders represented by the Association of Telecommunications Companies in Nigeria, (ATCON), Association of Licensed Telecommunications Operators in Nigeria (ALTON) and Nigeria Association of Telecommunications Subscribers (NATCOS) asked the government to suspend the implementation of the tax policy indefinitely.

But the Federal Ministry of Finance, Budget and National Planning and the Nigeria Customs Service (NCS) said they are going ahead with the policy implementation as only President Muhammadu Buhari has the power to suspend the implementation based on the schedule of the Act.

The government and telecom industry representatives spoke at the Stakeholders Consultative Forum organised by the Nigerian Communications Commission (NCC), at the Digital Economy Complex, Mbora,  Abuja.

Speaking on behalf of ALTON, its Chairman, Gbenga Adebayo said the Mobile Network Operators (MNOs) have taken holistic look at the five per cent excise duty, but had no choice but to pass the burden of payment to the subscribers.

He argued that the industry had been afflicted by exchange rate problems as well as high costs of diesel to power its infrastructures due to erratic power supply in the country.

Adebayo further stated that besides Value Added Tax of 7.5 per cent in the industry, there are 38 other taxes and levies being collected by states, local government and other agencies of government.

“Let me affirm our commitment to partner with the government on this issue and reiterate our resolve to ensure positive collaboration,  however,  it is important to let you know that telecom operators in Nigeria will not subsidise this new tax, but pass it to the subscribers,” Adebayo stated.

Shedding more light on the implementation of the tax, Adebayo said: “The five per cent Excise Duty will be paid by the subscribers. It will be collected by the operators on all voice and data services including over the top (OTT) operators and remitted to the Nigerians Customs.

The Executive Secretary of ATCON, Mr Ajibola Olude described the tax as unfair, harsh, unjust, opaque and indefensible. He said the tax failed to comply with the known principles of taxation. Adapted from The Nation

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