By Naomi Uzor Speaking at a stakeholders’ meeting organised by
the Lagos Chambers of Commerce and Industry,
LCCI, on CST bill which seeks to levy nine per cent
on subscribers for the use of the various
communication services, Shittu said the outcome of
deliberations on the bill would form the basis of his
advice to the President.
the Lagos Chambers of Commerce and Industry,
LCCI, on CST bill which seeks to levy nine per cent
on subscribers for the use of the various
communication services, Shittu said the outcome of
deliberations on the bill would form the basis of his
advice to the President.
The services include voice call, SMS, MMS, Data
usage from telecommunication service providers,
internet service providers and Pay TV Stations.
He noted that introduction of new taxes without
harmonising existing ones would put pressure on
the country’s tax system thereby making it
unattractive to investors.
According to the minister”This may also be
counter-productive in the long run for our targets on
broadband penetration. Our ICT Roadmap gives
fresh impetus for implementing existing policies
and reviewing any that is inimical to the growth of
the sector. My focus on any tax regime will be to
align any process that will stimulate the economy
and also ensure that the tax system is efficient by
widening the tax net. It is also to create an effective
framework for tax compliance to protect the poor
and vulnerable in the society who nonetheless have
to use telecoms services for social inclusion and
financial services.”
He said that the government’s efforts at increasing
its revenue made the bill worthy of consideration.
“I have been reliably informed that the projected
earnings from this effort is over N20 billion every
month, which is an attraction to the government for
funding our budget deficits. I must be quick to say
that this government has a human face twined
around its decisions,” Shittu said. The minister said
that the government would provide an enabling
environment for the ICT and telecommunication
sector to thrive through the enactment of relevant
legislation.
Mrs Nike Akande, President of LCCI called for a
friendly tax environment especially in view of the
difficult business environment.
“We know that the government is seeking to
diversify its revenue base in the light of dwindling
oil revenue. But it is also true that the private sector
players will like to see an investment friendly tax
environment, especially in the light of the prevailing
high cost of doing business in the country. It is
important to balance these two positions.”
Mr Bimbo Atilola, Chairman, LCCI Taxation and
Commercial Law Committee said that the bill
negated the principle of neutrality in taxation, as it
would affect consumers’ behaviour through reduced
spending. He appealed that the passage of the bill
be suspended to allow for rapid growth of the
telecoms sector, in line with the Nigerian National
Broadband Plan.
“If the bill must be passed into law, NASS should
make the telecoms sector exempted under VAT Act
and the rate reduced from nine per cent to five per
cent. There is a need to protect the ultimate
interest of the final consumers of the service,”
Atilola said.
Mr Taiwo Oyedele, Partner, PriceWaterCoopers said
that the N20 billion monthly projected revenue from
the bill was unrealistic and based on assumption.
According to him, increased taxation will reduce the
consumption pattern of consumers, lower
investment in the sector, thereby translating to
reduced revenue.
Mr Teniola Olusola, President, Association of
Telecommunications Companies of Nigeria
(ATCON) said that their members were
overburdened with multiple taxation.
He urged the government to discontinue the bill,
adding that it would reduce inflow of FDI into the
sector, reduce subscribers level of data
consumption and affect contribution of the sector to
GDP. Engr Gbenga Adebayo, President, Association
of Licensed Telecommunication Operators of
Nigeria (ALTON) said that the bill if passed into law
would slowpoke the growth of the sector.
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