Friday, June 9, 2023

Nigeria’s Minister Professor Pantami says Government exempted the Digital Economy Sector from excise duty

Contrary to some information in the public domain, the Nigeria’s Minister of Communications and Digital Economy, Professor Isa Ali Ibrahim (Pantami) has restated tha position of the President Muhammadu Buhari on the contentious issue of the 5% excise duty for telecommunications services.

In a release signed by Uwa Suleiman (Mrs), Senior Special Assistant on Media as well as the Spokesperson to the Honourable Minister of Communications & Digital Economy, Professor Isa said the Federal Government of Nigeria through the office of the Honourable Minister of Communications and Digital Economy, wishes to clarify the public misconception and press enquiry contained in the letter.

According to the release, “President Muhammadu Buhari GCFR, had on 21st March 2023, approved the exemption of the Telecommunications Sector from the proposed excise duty in line with the recommendations of the Presidential Review Committee on Excise Duty in the Digital Economy Sector”.

The release said, “The six-member Committee which was constituted at the behest of the Honourable Minister and approved by the President, was formally inaugurated on the 5th of September, 2022 and membership included; the Honourable Minister of Communications and Digital Economy as Chairman,  Honourable Minister of Finance, Budget and National Planning, Chairman Federal Inland Revenue Service (FIRS), Executive Chairman Nigerian Communications Commission (NCC) as Secretary  and two representatives of the Mobile Network Operators (MN0s). The Committee’s mandate was to critically and objectively assess the potential effects on the economy, of an additional 5% Excise Duty tax charge on the Digital Economy Sector”.

After five months of intensive and objective deliberations, the Committee submitted its report to the President precisely on the 13th of February 2023. The report had recommended the exclusion of the proposed, and then suspended 5% excise duty  tax on the Digital Economy Sector, citing incontrovertible facts including; the unprecedented contribution of the sector to the nation’s Gross Domestic Product (GDP), the sustained quantum leap in government revenue which currently stands at a staggering Five Hundred and Ninety four Billion Naira quarterly, its position as the baseline driver of innumerable businesses at the Micro, Medium and Small scale levels among others.

The Committee further analyzed the existing forty one (41) taxes, levies and charges already imposed on the sector and concluded that instead of burdening the sector with more taxes, concessions should be considered, in order to sustain its unprecedented contributions to the growth of the Nigerian economy. Based on the strength of its findings, the Committee prayed that the President exempts the Digital Economy Sector from the proposed additional Excise Duty.

The Honourable Minister of Communications and Digital Economy, Professor Isa Ali Ibrahim (Pantami) further emphasized that besides overburdening the sector, imposing additional taxes to the sector will bring hardship to the citizens of the country and appealed to the President’s compassion in his decision.

President Muhammadu Buhari GCFR on the  On 13th March 2023, approved the following prayer:

The Government exempts the Digital Economy Sector from excise duty charges in order to sustain and enhance use of Digital Economy services and to further benefit from their positive impacts on the economy.

The office of the Honourable Minister of Communications and Digital Economy, hereby assures the sector and the general public that the President’s approval, supercedes all other declarations regarding the issue and we stand by it. Any contrary proclamation should be disregarded by the general public.

Recall that Professor Isa Ali Ibrahim (Pantami), has vehemently opposed the proposed 5% Excise Duty for Telecommunications Services, on the grounds that it is unjustifiable, as it will be burdensome for the citizens of the country.

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