The federal government’s proposals to impose a 5% tax on all telecommunications services in the country were criticized yesterday by Isa Pantami, the minister of communications and the digital economy.
The judgment, in his opinion, wasn’t the result of careful consideration and would have a bad effect on the sector if it were to stand, so he pledged to challenge it with every legal instrument at his disposal.
The minister claimed that the industry shouldn’t be overtaxed considering that it currently provides significant cash, supports a sizable number of employees, and significantly increases GDP while speaking at the first Nigerian Telecommunications Indigenous Content Expo, or NTICE, in Lagos.
He declared: “The industry will be overburdened by the 5% excise levy. I was neither consulted or given a memo to that effect as a Minister. Even the appropriate parliamentarians who were meant to be consulted have admitted to me that they weren’t.
“That is not how things are done. Along with criticizing the tax, we will use every available legal means to ensure that it is repealed.
Pantami also bemoaned the high proportion of ICT and telecom equipment imports into the nation, despite the fact that some of these items could be purchased there.
All interested parties received the directive from him that “the Federal Government will not permit the importation of anything into the country going forward when we have the ability to create it.
“The industry needs to drastically cut imports. This policy should be put into effect by the National Office for the Promotion of Indigenous Content (NODIT) and the Nigerian Communications Commission (NCC).
We’ll be able to enhance our domestic content and decrease imports by around 20% by 2025.
The Minister’s attack on the excise duty comes after major players in the industry, including the National Association of Telecoms Subscribers, NATCOMS, Association of Licensed Telecoms Operators of Nigeria, ALTON, Association of Telecommunications Companies of Nigeria, ATCON, and others, criticized the move as being anti-people, provocative, odd, insensitive, and irresponsible.
They also stated that such imposition would worsen the suffering of the Nigerian masses, who had already been forced into hardship and extreme poverty, at a stakeholders’ forum organized in Abuja by the NCC to shed light on its intended implementation.
The new Finance Act, which the President will have signed into law in 2020, includes the new 5% Excise Duty.
President Buhari had ordered that it be applied on all telecom service providers in the nation on all domestic and foreign goods and services. It is intended to be collected by the Nigerian Customs Service.
At that event, Mrs. Zainab Ahmed, the minister of finance, budget, and planning, had also asked stakeholders to support the implementation, stating that the choice was motivated by the federal government’s declining oil and gas revenue.
She said that other African nations had taken note of the revenue generation method, including Malawi, Tanzania, and Uganda.