Group warns Buhari’s 5% tax on calls, data will worsen economy, hardship

The Centre for Information Technology and Development (CITAD) has urged President Muhammadu Buhari’s regime to shelve the planned 5.5 per cent increase in telecommunication services.

Finance Budget and National Planning Minister Zainab Ahmed, during a stakeholders’ forum, hinted at plans to increase excise duty on telecommunication services from the current 5.5 per cent.

However, NITAD director Yahuza ZakariYa’u, while briefing journalists in Kano, said the increase would bring more hardship to Nigerians. He appealed to Mr Buhari to jettison the proposed increase, asking him to set up the process of developing a national policy on community networks so that communities could address issues of their infrastructure.

“We find this unacceptable as it will not only create more hardship for Nigerians but also more fundamentally undermine the economic recovery of the country. The effect of the proposed increase is to make calls and data more costly in the context in which Nigerians are already paying heavily for this,” Mr ZakariYa’u explained. “Nigeria is one of the countries with a low affordability index as calculated by the Alliance for Affordable Internet.”

The NITAD director also observed that at the moment, less than 45 per cent of Nigerians have access to the full spectrum of telecommunication services, with several others not being able to afford both the cost of access and cost of use.

“This means that more than half of Nigerians are not able to do so for several reasons, chiefly among which is their inability to afford both the cost of access and cost of use. Nigeria does not manufacture telecommunication equipment and devices,” Mr ZakariYa’u stressed. 

The finance minister said Mr Buhari’s regime would generate about N160.46 billion from excise duty on telecommunication services in 2023. 

According to the Nigerian Communications Commission, the combined revenue of operators in the GSM, fixed wired, and internet service providers was N3.21 trillion in 2021.

Isa Pantami, the Minister of Communications and Digital Economy, kicked against the attempt to add a five per cent excise duty to telecommunication services. He said that this would bring the total tax telecom consumers pay for telecom services to 12.5 per cent.

He urged the regime to consider taxing other sectors of the economy, not contributing to national development. 

(NAN)