The Federal Government has removed the 5% excise duty on telecommunications services with a view to easing telecom services cost pressures on millions of Nigerian telecommunications subscribers.
The Executive Vice Chairman of the Nigerian Communications Commission (NCC), Dr. Aminu Maida, who gave this hint, said that President Bola Tinubu ordered the immediate removal of the levy during discussions on the Finance Act.
The EVC said: “President Tinubu directed the removal of the 5% excise duty on telecommunications services. The excise duty, it was the 5 percent or so, that is no longer there.
“Before it was suspended, but now the president has been magnanimous to remove it entirely. I was in a room when it was raised, and he said, no, we cannot put this on Nigerians. I was very pleased when the bills came out and we saw his words were followed through.
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“The development is expected to bring relief to over 171 million active telecom users across the country, many of whom have faced a 50% tariff increase implemented earlier this year,” Maida added.
It would be recalled that the 5% excise tax on telecommunications services was introduced in 2022 under the Buhari administration as part of its fiscal measures to boost non-oil revenue for the government.
The levy covered both voice and data services and operators were mandated to remit collection from the levy on or before 21st of every month to the government’s coffers.
While the fiscal authorities justified the levy based on the revenue shortfall and the need to expand the tax net beyond oil earnings, telecoms subscribers flawed the imposition of the 5% levy based on the burden on them due to the high tariffs they were already paying on telecoms services
The Association of Licensed Telecom Operators of Nigeria (ALTON) explained that the telecom companies were already contending with more than 39 different taxes, including a 7.5% VAT, and a mandatory 2% contribution of annual revenue to the Nigerian Communications Commission.
Following the telecom operators’ complaints over the rising costs of their operations, which they claimed could ground telecom services nationwide, the NCC, after months of stakeholders’ engagements, approved a 50% increase in telecom tariffs effective January 2025
Industry analysts believe that the removal of the 5% levy on telecom voice and data services will bring relief to over 171 million active telecom users across the country, many of whom are groaning since the imposition of a 50% tariff increase on services early this year.
