Stakeholders in the Telecom industry Thursday expressed concerns over plan by the federal government to implement Finance Act, 2020 which stipulates five per cent excise duty on all telecommunication services.

The stated this at a consultative forum on the implementation of excise duty organised by the Nigerian Communication Commission (NCC) in Abuja.

The federal government had disclosed that telecommunications subscribers would pay 5% tax on call, SMS, data services beginning from a date to be announced by the government.

Speaking at the event, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed urged stakeholders to support the implementation of the 5% exercise duty on telecommunications services.

This is coming as the Association of Licensed Telecoms Operators of Nigeria (ALTON), Association of Telecommunications Companies of Nigeria (ATCON), National Association of Telecoms Subscribers (NATCOMS), described the move as strange, insensitive and irresponsible.

Zainab represented by the Assistant Director, Tax and Policy, Mr Musa Umar appreciated Nigerian Communication Commission (NCC) for providing the platform to increase Nigeria’s revenue generation .

She highlighted that countries in Africa like Malawi, Uganda, Tanzania, others have all keyed into this revenue generation pattern.

She emphasised that this is needed to change Nigeria’s economic situation for good.

“The issue of revenue is not something that need to be shy away from, our revenue can no longer take care of our needs as a country.

“Also Nigeria is no longer making enough money in Oil revenue hence the attention is shifting to Non-revenue”.

She explained that the government is committed towards implementing the regulation in a seamless manner which will not affect Nigerians.

Earlier, in his remark, the Executive Vice Chairman/CEO NCC, Prof Umar Danbatta, represented by the Executive Commissioner Stakeholders management NCC Mr. Adeleke Adewolu said the forum is necessitate for stakeholders to get better clarifications on the 5% exercise duty on telecom services implementation.

He said the implementation of the 5 per cent excise duty was supposed to commenced on June 1, 2022 as part of the 2022 Fiscal Policy measures, but the industry considered the earlier scheduled commencement date inadequate and the NCC duly took this up with the federal government.

“As telecoms industry regulator, the Nigerian Communications Commission has engaged with the Federal Ministry of Finance, the Nigerian Customs Service and consultants from the World Bank to get needed clarifications. These engagements enabled us to better understand the objectives and proposed implementation mechanisms of the Excise Duty”, he stated.

On his part, Comptroller General of the Nigerian Customs Service, Hameed Ali urged stakeholders to be patriotic toward implementing the policy.

Hameed represented by the Assistant Comptroller General NCS, Mrs A.S Oshishi revealed that telecommunications operators are expected to be dully registered with the service for seamless actualization of the process.

Speaking at the event via zoom, the Chairman, ALTON, Engr Gbenga Adebayo insisted that the new tax burden would be passed to subscribers.

“It is a strange move, it appears a bit unusual. Exercise duty is supposed to be apportioned to goods and products, but we are surprise this is on services.

“We will continue to support government but ALTON won’t be able to subsidy this on behalf of subscribers in addition to the 7.5% VAT making it 12.5% payable by subscribers to the federal government.

“The 5% Excise Duty will be paid by the subscribers. It will collected by the operators on all voice and data services including OTT and remitted to the Nigerians Customs”, he stated.

On his part, the President of ATCON, Engr. Ken Nnamani said, “the proposed exercise duty do not comply with principle of taxation, fairness, certainty, convenience and efficiency”.

Nnamani represented by ATCON Executive Secretary, Mr Ajibola Olude said FG has continued to turn blind eye on the issue of foreign exchange, other challenges facing telecom operators in Nigeria.

He appealed that the implementation of the exercise duty should be stepped down because many youths in Nigeria will lose their jobs.