Tuesday, August 26, 2025
25.6 C
Lagos

ATCON to FG: Step Down Communications Services Tax Bill

Mr. Olusola Teniola, President, Association of Telecommunications Companies of Nigeria [ATCON] has urged the Federal Government to step down the proposed Communications Service Tax Bill for now. Below are the key points of his submission:

Decrease in the Inflow of FDI to the Sector

The general rule of investment or principle of investment is that institutional Investors will take their investible funds to countries where the tax rate is low or lowest. As we all know that Nigerian telecoms subscribers are already paying tax because VAT is embedded in calls made and data consumed.

If the bill sails through it would reduce the subscribers’ consumption of data and reduce length of a voice call, this will result in drop in revenue that would accrue to telecoms operators which will in turn reduce the contribution of the sector to our GDP.  

The Return on Investment (ROI) would be badly affected as a result of the above illustrations.

Nigeria as a nation needs a lot of investible funds to build infrastructural facilities and provide employment for her teeming population and especially our growing youth.

As we know that Nigeria’ telecom industry still needs circa 50,000 base stations to be able to improve on Quality of Service and to reach the unserved and underserved parts of the nation.  

ATCON’s position is that whatever we are doing as a nation must not be done to deter investors from staking their hard earned money on the Nigerian telecommunications businesses, in other words, our policies must continue to be investment friendly.

It has been established that revenue from voice is still significant and it must be stressed here that the investment that is required to deepen the penetration of Broadband in Nigeria is much greater than the one we used to provide voice telephony.

In view of this, the said Communications Service Tax bill should be stepped down so as to encourage investors and make the sector more attractive for foreign direct investors.  

ATCON is working with other relevant agencies to increase the Foreign Direct Investment to the sector which is highly capital intensive. This cannot be achieved if the government is considering introducing Communications Services Tax, which will deter further investments to be made.

Loss/Erosion of Innovation and Creativity

ATCON considers the proposed Communications Services Tax bill unnecessary and prohibitive because the operators in the sectors are already faced with multiplicity of taxation.

Imposition of Communications Services Tax bill could stifle innovation and creativity in the sector and this would automatically reverse the gains already made in the past decade. This might lead to increase in unemployment, decrease in revenue accruable to government which would heighten the county’s poverty level.

Telecoms Services Unavailability in Some States

Governments at all levels have at one time or the other expressed the need to gear up the use of ICT to grow and develop their various constituencies. The application of the proposed Communications Services Tax would definitely be a clog in the wheel of roll out of broadband services for the development of the nation-Nigeria. It means that telecommunications services would not be available in some state of the federation.

Speeds-up Chronic Recession

The high taxation takes so much away from both the telecoms operators and subscribers that little or nothing is left to run the business. If government tries to boost the economy with increased government spending, the result is stagflation (simultaneous high inflation and unemployment) instead of prosperity. The only cure for stagflation is to cut both taxes and government spending.  

spot_img
spot_img

Hot this week

Japan Designates City of Kisarazu as Hometown for Nigerians

Mrs. Florence Akinyemi Adeseke, Nigeria’s charge d’affaires and Yoshikuni...

Tinubu Lauds Petrobras’ Imminent Return as Nigeria, Brazil Ink MoUs to Boost Economic Ties

President Bola Tinubu on Monday welcomed Petrobras's imminent return...

Businessman, Ajose, Donates Materials to APC for Continuous Voters Registration Exercise

As part of efforts to support the rulling All...

LASAA Reaffirms Commitment to Fairness, Safety, Industry Growth

Prince Fatiu Akiolu MD, LASAA Lagos State Signage and Advertisement Agency...

Fidelity Bank to Convene Strategic Panel on Export Financing at FNITCC Atlanta 2025

As part of its ongoing commitment to expanding Nigeria’s...

Topics

Red Star Express Posts N6.6bn Turnover

A leading logistics Company, Red Star Express Plc has...

Mobile Payment – A Game Changer in Africa

Writing in his latest annual “Gates Notes” letter, Microsoft Founder and Philanthropist, Bill Gates highlighted the digital banking sector and observed that smartphones and mobile technology would define banking in Africa, especially in those communities where the cost of banking and a lack of infrastructure remain major barriers to entry.

Stanbic IBTC Continues Impressive Impact in Education

  Stanbic IBTC Bank Plc, a subsidiary of Stanbic IBTC...

GNI: MotorFlex Insurance Will Generate Premium Customer Experience

Cecilia O. Osipitan Managing Director/CEO Great Nigeria Insurance Plc One of the...

AfDB, ASEA Sign MoU to Develop Africa’s Capital Market

The African Development Bank (AfDB) and the African Securities...

How Nigerian Politics Rivals Nollywood for Drama

In our series of letters from African journalists, novelist and writer, Adaobi Tricia Nwaubani looks at why Nigerians are hoping to be entertained by a crackdown on corruption. Two major industries in Nigeria share similar elements of melodrama and wildly implausible plots -films and politics.

AIICO Insurance Grows GWP by 21.4% to N45.5bn in H1 2022 

AIICO Insurance Plc, foremost and most resilient insurance services...

Stanbic IBTC Donates COVID-19 Test Kits to Lagos State Govt

L-R: Bridget Oyefeso-Odusami, Head, Marketing and Communications, Stanbic IBTC...
spot_img

Related Articles

Popular Categories

spot_imgspot_img