Collins Nnabuife
The Minister of Communications and Digital Economy, Professor Isa Pantami, has announced that President Muhammadu Buhari has exempted the digital economy sector, including telecommunications, from the proposed 5 percent excise duty.
The Minister said the decision came as the Presidential Committee on Excise Duty concluded its assignment and submitted its report to the President.
Pantami said the President charged other sectors that are not contributing enough to improve their revenue generation.
He said President Buhari was informed that the inclusion of the digital economy sector in the proposed 5 percent excise duty will increase the sufferings of the masses.
“On the 6th of March 2023, I am glad to say that President Muhammadu Buhari has approved the exemption of the Digital Economy sector from the 5 percent excise duty to be paid, and this is because of the strength of the argument presented to him that the implementation will increase more suffering on our citizens.
“The President strongly insisted that other sectors that are not contributing enough are to be challenged to improve revenue generation to the government, not the sector that has already increased its revenue generation by 594 percent within only 3 years”, he said.
The Minister recalled that there was an issue where excise duty was introduced into the sector without following due process, which was part of the requirement of a subsidiary principal law that stakeholders must be contacted
“I was not contacted and when the plan and proposed excise duty in the sector were announced, u challenged it and I wrote a letter to the President with my complaints.
“On the 12th of August 2022, with two prayers, firstly for the President to suspend and put the proposed excise duty of 5 percent on hold and secondly to constitute a committee to look into the issue critically and professionally and advise Mr President on the best way to handle it.
“Mr President approved the two prayers, the first one is the suspension of the purposed excise duty in the digital economy sector, and secondly, he approved the committee directing me to chair the committee, among the members, we have the Minister of Finance, Budget and National Planning, Executive Vice Chairman of NCC, Chairman of Federal Inland Revenue Services and the Representatives of Mobile Network Operators”, he said.
Pantami said that within the telecommunications sub-sector, currently, there are 41 categories of taxes, levies, and charges, arguably, this will be a global record, so there is no justification for adding more burden on the same sector that, according to him is doing well when it comes to our economy.
“Many Micro, Small, and Medium Enterprises (MSMEs) depend on the telecommunications sector to function and if you look at it statistically, most of our commercial activities in Nigeria are within MSMEs, so if we allow the price of this 5 percent excise duty to be increased, the negative impact is not only on the sector, it will be extended to other sectors that are leveraging on the telecommunications services, because if you increase 5 percent, it will be extended to the citizens because it will be part of the production cost.
“The committee submitted the recommendations to the President and on the 14th of December 2022, I had an agreement with the Minister of Finance that whatever the President decides is going to be the final position to be in implemented by all”, he added.
