The federal government has announced the removal of its proposed five per cent excise duty on telecommunication services.
The minister of communications and digital economy, Mr. Isa Pantami, disclosed this while briefing journalists I Abuja yesterday.
He said the action was taken following the recommendations of the presidential review committee on excise duty in the digital economy sector, which was constituted to review the implementation of excise duty in the telecom sector.
“I am happy to report to you that President Muhammadu Buhari, GCFR, has approved the exemption of the digital economy sector from the five per cent excise duty to be paid and this is because of the strength of the argument presented to him by the Committee that additional burden on telecom sector will increase the sufferings of Nigerians and that other sectors that are not making as much contribution to the economy should be challenged to do more and pay the five per cent excise duty,” Pantami said.
The minister further stated that if the tax had been upheld, many businesses would have felt the effect.
“Many MSMEs and SMEs depend on the sector for survival; if the tax is increased, the impact will take a toll on these businesses.
“There is no need for excise duty in the telecom sector because the industry is already heavily taxed up to 41 taxes. The sector has been contributing hugely to Nigeria’s economy; more tax burden destroys the industry.
“We increased revenue generated by 594 per cent from N51 billion quarterly to N481 billion quarterly. This is the only sector where the prices of services have been reduced. here is no justification for the government to impose more burden on its poor citizens,” he added.
He noted that the tax exemption will be upheld by the incoming administration.
Recall that that the federal government had July 2022, announced plans to implement a five per cent excise duty tax on telecom services in a bid to increase its revenue sources.
