FG Bows to Pressure, Suspends 5% Excise Duty on Telecom Services

Written by on September 6, 2022

The Federal Government has suspended its planned implementation of 5% excise duty on telecommunications services.

The suspension was announced by the Minister of Communications and Digital Economy, Isa Pantami, on Monday during the inaugural meeting of the Presidential Committee on Excise Duty for the Digital Economy Sector in Abuja.

The Minister who had earlier rejected the proposed tax noted that the telecommunications sector is already overburdened by excessive and multiple taxations.

“Excessive taxation has been a central challenge of the Information and Communications Technology sector”, he said, arguing that it is unfair to overburden such a sector that is so central to the nation’s growth and development and especially because the sector rarely receives subsidy which other sectors have enjoyed.

“Despite the spiraling inflation, and cost of production, particularly the energy factor, the network service providers have not increased prices of services. I challenge the gentlemen of the press here to name one sector that has not witnessed price increases in services in the last three years. It is only in telecoms that prices have been stable,” Pantami said.

However, with the announcement of the suspension of the tax coming from the Communications Minister, it is unclear yet if the decision has the buy-in of the Budget Office and the Minister of Finance, who announced the commencement of the tax implementation from next year.

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