Skip to main content

Discord In Nigerian Government As Budget Office Counters Minister, Says Telecoms Tax On Mobile Calls, Data Stands

Illustration
September 7, 2022

The Budget office noted that the telecoms tax remained intact – an assertion which showed discordant tunes in the Muhammadu Buhari-led Nigerian government.   

The Budget Office of The Federation has countered a pronouncement by the Minister of communications and digital economy, Isa Ali Pantami, that the five percent telecoms tax on mobile calls and data used by Nigerians had been suspended. 
The Budget office noted that the telecoms tax remained intact – an assertion which showed discordant tunes in the Muhammadu Buhari-led Nigerian government.   
The director-general of the Budget Office, Ben Akabueze, maintained that the tax remained in effect as the Budget Office of the Federation and the Federal Ministry of Finance, Budget and National Planning had not been advised about the suspension.

Speaking on Arise News TV, Akabueze stressed that the five per cent tax on telecom services is part of the federal government’s expected revenue to fund the medium-term expenditure framework and that the bill had been passed into law.

He argued that a suspension would mean further fiscal deficit for Nigeria, just as he said telecom operators in Nigeria are not overtaxed but rather under-taxed.

“This wasn’t something that the Ministry of Finance woke up and introduced. The finance bill went through the Federal Executive Council; it went to the National Assembly as, an executive bill from Mr. President, there were public hearings, and at the end of the day they passed it into law.”

According to him, his office engaged with different stakeholders including Customs, the Nigerian Communications Commission (NCC) and other industry practitioners to discuss the modalities for the implementation before

“Let me say, I don’t know about the suspension, I mean, this is the law now. So, I haven’t heard beyond what I’ve read in the media. We haven’t been advised about the suspension. So, for instance, recently, the Federal Executive Council passed the medium-term expenditure framework for 2023 and 2025. That includes projections for this tax; that framework is currently before the National Assembly in the last two weeks, and the Finance Committee of the National Assembly has been holding engagements with agencies of government on this.

“So, when we are formally advised that this is no longer applicable, then we will have to rework the medium-term expenditure framework. What that means is, of course, that the projected revenues will diminish, and the deficits would increase, which means that we either have to cut back on expenditure or increase debt,” he added.