The proposed nine per cent communication tax bill currently before the upper legislative chamber of the National Assembly may deprived about 20 million Nigerians access to telecommunications services if passed into law, the Association of telecommunication Companies of Nigeria (ATCON) have disclosed.
During a courtesy visit to the Senate President, Bukola Saraki, ATCON President, Olusola Teniola appealed to the Senate to use its powers to reduce tax to 0.2 percent from nine percent.
“We ask for a reconsideration of the CST Bill, we recommend, as an alternative, a tax reform that increases the current VAT by a new one per cent added for the purpose of development of communications.”
Mr Teniola further said “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.”
He said, “Contrary to popular belief, telecommunication operators and service providers are barely sustaining existence in these times.
“There are reasons to suggest that the desire to widen the tax net is laudable and that as things stand telecommunications is about one of the few areas where the net-capture may be widened.
“We, therefore, suggest that an increase in VAT tax, which is already included in all services of telecommunications by an increase that is not beyond one per cent will be a good reform strategy.”
In his response, the Senate President assured ATCON that the red chamber would look into the requesting, describing the telecommunications sector as critical to the nation’s 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.”