Buhari govt suspends 5% excise duty on telecom companies

Buhari govt suspends 5% excise duty on telecom companies

The Federal Government has put a hold on the introduction of the 5% excise levy the FG had previously proposed for telecom services. This information was made public on Monday when Isa Pantami, the minister of communications and digital economy, established a committee to examine the 5% excise levy.

Pantami claimed that President Buhari approved his request for the immediate suspension of the 5% excise charge during the inauguration of the committee on the review of the excise duty in the telecom sector.

“It is because of this that the president has answered my pleas; neither has he immediately suspended excise tax in the sector of the digital economy, nor has he approved the creation of a committee to thoroughly investigate the situation and advise the president appropriately. The Minister of Communications and the Digital Economy will serve as the committee’s chair.

He said, “The president has designated me to serve as his eyes and ears in the industry. and it is my duty to make sure we treat everyone fairly, including the operators, the government, and most importantly, our citizens who are the consumers.

He continued by explaining to the committee how he had informed the president about the impact of the excise charge on the industry.

Recently, it was revealed that a few of our esteemed brothers and sisters in government had begun the process of implementing excise duty in the telecom sector, in accordance with the constitution and as President Buhari’s representative in the industry. Being the president’s representative, I categorically rejected that.

In a letter that might be considered a petition, I formalized my stance and provided him with an explanation, citing the fact that excise duty is often set at a higher rate for luxury goods.

In the letter, I said to the president, “If caution is not taken, that attempt would kill the digital economy sector that is emerging as the backbone of our economy.”

When asked why he opposed the excise tax, he responded, “Despite our accomplishments, we have been documenting certain obstacles in the industry, and if caution is not exercised, these issues might be a barrier in the growth of the sector in the coming years.

“One of them is excessive taxation, often in the form of several levies. As it stands right now, the ICT sector has 39 tax categories, which is very worrying.

“However, as of right now, the ICT industry is overtaxed with so many different types of taxes that there are currently 41 different types of taxes at the federal and state levels, especially in the telecom sector. some at the state level, some at the federal level.

“In addition to these taxes, there are other taxes that must be paid. The states demand payment of the same taxes as are collected at the federal level. The advancements and accomplishments we have so far made in the industry are in danger if caution is not taken in this regard.

Pantami pointed out that although costs have climbed dramatically in the order industry over the past three years, they have not increased much overall.

The mobile network operators have been coming up with several initiatives requesting the regulator to let them to evaluate their pricing higher in response to factors outside of our industry, such as petroleum goods, exchange rates, inflation, and currency depreciation, among others.

The current economic climate in Nigeria does not allow us to continue to add burden on our poor citizens who are suffering and can hardly get three square meals in a day, and broadband and telecommunications services are becoming more of a necessity than a luxury. Therefore, whenever the regulator escalates the matter to me, I will always encourage and urge them to try and persevere with the little profit they are making.

According to him, Mnos has been asking for our permission to raise the pricing of their goods. I had been pleading with them to exercise patience. More than 15 efforts to raise the cost of telecommunications services have been made in the past three years, and I have consistently resisted each one.

The Committee will be led by the Minister of Communications and the Digital Economy.

The group is led by Pantami, while the Minister of Finance and National Planning, the Executive Vice Chairman (EVC) of the Nigerian Communications Commission (NCC), and representatives from all Nigerian telecom firms are also members.