Minister of Finance, Budget and National Planning, Zainab Ahmed, and the Minister of Communication and Digital Economy, Prof Isa Ali Pantami, have been set on a collision course over the Federal Government’s new telecom tax.
The Federal Government through the Budget Office announced that it will start enforcing its proposed 5 per cent exercise duty tax on communications services and beverages in 2023.
According to Industry experts who spoke with DailyTrust, the new tax regime will have a huge impact on both subscribers and telcos, which would translate into rising in tariffs and Nigerians will pay as much as N40 per minute call and data tariffs could also go up to about N2,500 per gigabyte.
The finance minister, who unveiled the plan at a stakeholders’ forum on the implementation of excise duty on telecommunications services in Nigeria organized by the Nigerian Communications Commission (NCC), said the 5 per cent excise duty was in the Finance Act, 2020.
She stated that accrued taxes would be paid monthly, on or before the twenty-first day of each month.
The minister said that the action was a part of the government’s endeavour to increase non-oil revenue in response to declining income, particularly from the oil sector.
While Zainab cites presidential approval to apply the new excise on telecommunication services, as provided by the Finance Act, the Ministry of Communication and Digital Economy is kicking on the ground that the new tax would be harmful to the sector and subscribers.
In his speech at the inaugural Nigerian Telecommunications Indigenous Content EXPO (NTICE) in Lagos, themed “Stimulating the development of Indigenous Content through innovation and commercialization.” Pantami emphasized the need for the government and stakeholders to continue supporting the sector and not unduly burden it.
He said: “The Ministry of Communications and Digital Economy is not satisfied with any effort to introduce excise duty on Telecommunications. When VAT was increased to 7.5percent, I was not consulted, I only heard the announcement and I think there is something questionable and I am glad that we are on the same page with our national assembly members. They too have not been consulted despite the fact that they are part of the committee.
“Beyond, making our position known, we will go behind the scene and go against any policy that will destroy the digital economy sector. This is a sector we cherish so much and we are ready to go to any extent, legitimately and legally to defend its interest.”
Pantami also maintained his lack of support for the planned excise duty hike.
This article was originally published on Naija News