Minister of Communications and Digital Economy, Professor Isa Pantami, has made clarifications on the public misconception and press inquiry about the publicized 5% excise duty for telecommunications services.
According to a press release on Wednesday, May 3, 2023, signed by the SSA Media/Spokesperson to the Minister of Communications and Digital Economy, Uwa Suleiman (Mrs.), President Muhammadu Buhari had, on March 21, 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 statement read, “The six-member Committee, which was constituted at the behest of the Honourable Minister and approved by the President, was formally inaugurated on September 5, 2022, and membership included the Honourable Minister of Communications and Digital Economy as Chairman, the Honourable Minister of Finance, Budget, and National Planning as Chairman, the Chairman of the Federal Inland Revenue Service (FIRS), the Executive Chairman of the 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 February 13, 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, and its position as the baseline driver of innumerable businesses at the micro, medium, and small scale levels, among others.
“The Committee further analysed 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 exempt the digital economy sector from the proposed additional excise duty.
“The Honourable Minister of Communications and Digital Economy, Professor Isa Ali Ibrahim (Pantami), further emphasised that besides overburdening the sector, imposing additional taxes on the sector will bring hardship to the citizens of the country and appealed to the President’s compassion in his decision.
“President Muhammadu Buhari GCFR, on March 13, 2023, approved the following prayer:
The government exempts the Digital Economy Sector from excise duty charges in order to sustain and enhance the use of Digital Economy services and to further benefit from their positive impacts on the economy.
“The office of the Honourable Minister of Communications and Digital Economy hereby assures the sector and the general public that the President’s approval supersedes all other declarations regarding the issue, and we stand by it. Any contrary proclamation should be disregarded by the general public.
Recall that Professor Isa Pantami has vehemently opposed the proposed 5% excise duty for telecommunications services on the grounds that it is unjustifiable and will be burdensome for the citizens of the country.
