The Association of Telecommunication Companies of Nigeria has said the passing into law of the nine per cent Communications Service Tax bill currently before the Senate would deprive 20 million Nigerians access to telecommunications services.
This was contained in a statement issued on Saturday in Lagos by ATCON’s President, Mr. Olusola Teniola, after he led a delegation of his members on a courtesy visit to the Senate President, Dr. Bukola Saraki.
He urged the Senate to use its legislative powers to reduce the nine per cent CST to 0.2 per cent.
According to the ATCON president, the nine per cent new tax on telecommunication services being proposed by the National Assembly will exclude 20 million Nigerians, which represent 10 per cent of the country’s population, from accessing telecommunication services, the News Agency of Nigeria reports .
“ATCON’s mandate is to make meaningful input to all aspects of economic development, including legislation and management of telecommunication industry, so it continues to oil growth and development. The ongoing work on the proposed nine per cent Communication Service Tax Bill is a trending subject.
“We will be happy to support the government to make the best of our tax efforts, which certainly are key components of strengthening the economy and sustaining our industry. Contrary to uninformed opinions, we do not object to reforms in taxation, neither do we regard taxes as burden,” Teniola said.
He added, “We ask for a reconsideration of the CST Bill; we recommend, as an alternative, a tax reform that increases the current Value Added Tax by a new one per cent added for the purpose of development of communications. Another alternative is that the tax being proposed in the bill should be limited to 0.2 per cent.”
Teniola pleaded that the template, with which the telecommunication industry was viewed and assessed, should be slightly modified.
“The truth is that there is severe over-taxation in our industry. It explains the slow penetration of services into areas yet to be covered by our services across the country. Contrary to popular belief, telecommunication operators and service providers are barely sustaining their existence in these hard times.
“There are reasons to suggest that the desire to widen the tax net is laudable and that as things stand telecommunication is about one of the few areas where the net-capture may be widened,” the ATCON boss stated.
Responding, Senate President, Bukola Saraki assured the ATCON leadership that the Senate would only make laws that would boost the economy.
“The ICT sector is critical to the Nigerian economy; as a result, the Senate will never make laws that will push the sector into a negative performance. Rather, the Senate will make laws that will increase its performance to generate revenue and create jobs,” Saraki said.
