Telcos Reject Proposed 9% Communication Tax

By Adedapo Adesanya

Association of Telecommunications Companies of Nigeria (ATCON) and the Association Licensed Telecommunications Operators of Nigeria (ALTON) have expressed their displeasure at the 9 percent tax bill moved by a former Senate Leader, Mr Ali Ndume.

Business Post reported on Thursday that the Senate had deliberated on a bill that would tax electronic communication on services like calls and data usage from telecommunication providers and Internet service and also subscriptions to cable TV services.

This would not be the first time such proposal had been made. In 2016, a similar bill was brought forward but the Mr Bukola Saraki-led Senate, after deliberations with ATCON, had suspended the planned action.

Speaking on the latest move to bring this bill to life again, Mr Olusola Teniola, representing ATCON, said the immediate past National Assembly had abandoned the plans to tax these communication services because they understood the impact of the Information and Computer Technology (ICT) sector in job creation.

He called on the lawmakers to instead broaden the tax base to enable more businesses to have tax commitment.

ALTON, on the other hand, said the tax would affect the standard of living of Nigerians whose purchasing power of Naira is already very low. The association said that imposing tax on essential services like calls, texts and data will not help improve this.

Senator Ali Ndume introduced the Bill for an Act to establish the Communication Service Tax at Wednesday’s plenary session.

The bill is set for a second reading before being referred to the appropriate committee for further legislative action including a public hearing.

If the is bill passed into law, it means there will be a tax of 9 percent on all communication services – voice calls, SMS, MMS, surfing data from both telecommunication services providers and internet service providers, as well as pay-per-view TV stations – and this means less value for the same amount of money, or less value for more money.

For example, if a subscriber buys a recharge card of N1,000; it will either mean they get N910 in value or pay more to the tune of N1,090.

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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