As the Federal Government continues its fiscal reform drive targeted at boosting the nation’s non-oil sector revenue, the Minister of Communications and Digital Economy, Prof Isa Pantami, disclosed on Tuesday that President Muhammadu Buhari had approved the exemption of the digital economy sector from the proposed 5% excise duty payment.
The minister, who gave this hint during a press briefing to update the public on the recommendations of the Presidential Review Committee on Excise Duty and the final decision taken by the President based on the provisions of Section 5 of the 1999 Constitution (as amended) in Abuja, said the exemption was sequel to the sustained plea by the ministry for the fiscal gesture from the government.
The minister had over the past six months expressed his ministry opposition to the proposed levy by making representation to President Buhari and the Federal Executive Council (FEC) based on the potential negative implications for the sector and more importantly the economy if implemented.
According to him, with 41 categories of taxes, levies and charges already in the digital economy sector there is no justification for an additional excise.
Pantami further clarified: “There is no need for excise duty in the telecom sector because the industry is already heavily taxed up to 41 taxes.
“The sector has been contributing hugely to Nigeria’s economy; more tax burden destroys the industry. We increased revenue generated by 594 per cent from N51 billion quarterly to N481 billion quarterly.”
He added: “This is the only sector where the prices of services have been reduced. There is no justification for the government to impose more burden on its poor citizens.
“Many MSMEs and SMEs depend on the sector for survival; if the tax is increased, the impact will take a toll on these businesses.
“To this end, on March 6, President Muhammadu Buhari approved the exemption of the digital economy sector on the 5 per cent excise duty because it would harm Nigerian citizens”, the minister added.
In his remarks at the forum, the Executive Vice Chairman of the Nigerian Communications Commission, NCC, Prof Umar Danbatta, commended the minister for championing the cause of consumer-friendly telecommunications services fiscal regime and reiterated the commission’s commitment to improving the standards of service delivery in the telecom industry.
Danbatta explained the reduction of data tariff had been one of the major desires of the NCC, pointing out that through the support of the minister over the past few years, the average 1 gigabit of data had dropped to an average of N335 and N350, depending on the network from N1,200 it was in 2019.
He advised Nigerians still experiencing high data tariffs to report any mobile network operator (MNO) still charging exorbitant prices for data to the commission for necessary intervention.
