The Federal Government will generate about N160.46bn from excise duty on telephone calls and mobile data in 2023.
According to the Nigerian Communications Commission (NCC), the government will generate about N160.46bn if it implements its five percent excise duty on telecom services.
The NCC also disclosed that the combined revenue of operators in the GSM, Fixed Wired, and Internet Service Providers was N3.21tn in 2021.
It said the N160.46b, however, assumes that the revenue of the telcos would be static. But in real terms, it could either be higher or lower depending on economic fundamentals in 2022.
Recently, the Federal Government disclosed a plan to implement a 5 per cent excise duty on telecom services in the nation.
This Minister of Finance Budget and National Planning, Zainab Ahmed, made this known during a stakeholders’ forum on the implementation of excise duty on telecommunications services in Nigeria.
Ahmed, who spoke through the Assistant Chief Officer of the Ministry, Frank Oshanipin, said the implementation of the excise duty was in a bid to increase the government’s revenue.
She said, “The duty rate was not captured in the Act because it is the responsibility of the President to fix rate on excise duties and he has fixed five per cent for telecommunication services which include GSM.
“It is public knowledge that our revenue cannot run our financial obligations, so we are to shift our attention to non-oil revenue. The responsibility of generating revenue to run government lies with us all.”
At the forum, the finance minister disclosed that the tax would be implemented soon but doubts have since risen concerning whether the excise duty will be implemented at all.
The Minister of Communications and Digital Economy, Isa Pantami, on Monday, disclosed that he was against the tax and would everything to stop its implementation.
According to him, the telecoms industry was already doing a lot regardING revenue generation in the nation and attempts to stretch it any further might negatively impact it.
Speaking at the maiden edition of the Nigerian Telecommunications Indigenous Content Expo organised by the Nigeria Office for Developing the indigenous Telecom Sector, he stated, “The ministry of communications and digital economy is not satisfied with any effort to introduce excise duty on telecommunication services.”
He added, “Beyond making our position known, we will go behind the scenes and go against any policy that will destroy the digital economy sector. We will go to any extent to legitimately and legally defend its interest.”
The tax is likely to be passed on to telecommunications consumers who will bear the burden.