The plot by another Minister in the President Muhammadu Buhari Government to introduce a five percent telecommunications excise duty lacks the approval of the Nigerian Government.
Reacting to the circulation of a document titled: Approval for the implementation of the 2023 fiscal policy measures and tariff amendments allegedly emanating from a government institution, the Minister of Communications and Digital Economy, Professor Isa Pantami, said that there is no such approval from the President.
According to him, the Government had exempted the Digital Economy Sector from excise duty charges in order to sustain and enhance use of Digital Economy services and to further benefit from their positive impacts on the economy.
He assured the telecoms industry and the general public that the President’s approval, supercedes all other declarations regarding the issue, saying that “we stand by it. Any contrary proclamation should be disregarded by the public.”
The Minister noted that he had previously vehemently opposed the proposed 5% Excise Duty for Telecommunications Services, on the grounds that it is unjustifiable, as it will be burdensome for the citizens of the country.
Pantami further said that besides overburdening the sector, imposing additional taxes to the sector, it will bring hardship to the citizens of the country and appealed to the President’s compassion in his decision.
The president had on 21st March 2023, approved the exemption of the Telecommunications Sector from the proposed excise duty in line with the recommendations of the Presidential Review Committee on Excise Duty in the Digital Economy Sector.
The six-member Committee which was constituted at the behest of the Minister and approved by the President, was formally inaugurated on the 5th of September, 2022 and membership included; the Minister of Communications and Digital Economy as Chairman, Minister of Finance, Budget and National Planning, Chairman Federal Inland Revenue Service (FIRS), Executive Chairman Nigerian Communications Commission (NCC) as Secretary and two representatives of the Mobile Network Operators (MN0s).
The Committee’s mandate was to critically and objectively assess the potential effects on the economy, of an additional 5% Excise Duty tax charge on the Digital Economy Sector.
After five months of intensive and objective deliberations, the Committee submitted its report to the President precisely on the 13th of February 2023.
The report had recommended the exclusion of the proposed, and then suspended 5% excise duty tax on the Digital Economy Sector, citing incontrovertible facts including; the unprecedented contribution of the sector to the nation’s Gross Domestic Product (GDP), the sustained quantum leap in government revenue which currently stands at a staggering Five Hundred and Ninety four Billion Naira quarterly, its position as the baseline driver of innumerable businesses at the Micro, Medium and Small scale levels among others.
The Committee further analyzed the existing forty one (41) taxes, levies and charges already imposed on the sector and concluded that instead of burdening the sector with more taxes, concessions should be considered, in order to sustain its unprecedented contributions to the growth of the Nigerian economy.
Based on the strength of its findings, the Committee prayed that the President exempts the Digital Economy Sector from the proposed additional Excise Duty.
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