NCC Moves to Expunge 5% Excise Duty in Telecoms Operations

Emma Okonji

Following the recent suspension of five per cent excise duty on telecoms operations across networks by President Bola Ahmed Tinubu, the Nigerian Communications Commission (NCC), has said it has commenced discussions with the appropriate authorities, for the outright removal of the 5 five per cent excise duty on telecoms operations.

Executive Vice Chairman of NCC, Prof. Umar Garba Danbatta, who revealed this in Lagos said although the telecoms industry remained appreciative to President Tinubu for the suspension of the 5 per cent duty, it became necessary to push for its complete removal because it would be inimical to telecoms growth in the country.

Danbatta said: “When the previous government attempted to introduce five per cent excise duty on telecommunications services, we objected to it and listed 41 levies and charges imposed by various governments on telecoms services, and as of today, the number has risen to 46. Such levies and charges are duplicated across states, amounting to double taxation on the part of telecoms operations.

“It was a shock to industry stakeholders when the same levy resurfaced after there was a presidential pronouncement by the former President Muhammadu Buhari’s government for its suspension. We are grateful that the current President Bola Ahmed Tinubu has recently suspended it again, but all we are asking for now is for the presidency to expunge it completely and to put a dead end to the issue of five per cent excise duty on telecoms services. We will continue to convincingly argue that the five per cent excise duty on telecommunications should be completely removed, ”Danbatta said.  

According to him, telecommunications services should be exempted from excise duties because excise duties are meant for luxury goods and services and telecommunications services cannot be considered as luxury services, but essential services that are addressing the concerns of all Nigerians, irrespective of the sector that they play in.

“Currently, there are 222 million Nigerians that are actively subscribed to telecommunications services across networks, and any attempt to introduce excise duty on telecoms’ services, will affect the purchasing powers of the 222 million Nigerians that are actively subscribed to telecoms services in the country. The implication is that many out of the 222 million active subscribers may not be able to pay for telecoms services across networks, should five per cent excise duty be imposed on telecoms operations,” Danbatta further said.  

Commenting, Chairman, Association of Licensed Telecoms Operators of Nigeria (ALTON), Gbenga Adebayo, commended President Tinubu, saying that the suspension is a good development for telecoms subscribers and the entire telecoms industry.

“The Nigerian public should be grateful to the current government for being brave enough to suspend the five per cent excise duty on telecoms. As operators, we had been instructed to collect the tax from telecoms subscribers and remit same to the federal government, but with the suspension order, operators will no longer collect such tax and the subscribers will be free from the tax burden,” Adebayo said.