Nigeria’s Minister of Communications and Digital Economy, Isa Pantami, has kicked against the Federal Government’s plans to impose a 5% excise duty on telecommunications services in the country.
The minister, who spoke at the maiden edition of the Nigerian Telecommunications indigenous Content Expo, NTICE, in Lagos, said the sector, which was already drawing in massive interest, creating jobs, and enlarging huge revenue to the GDP, should not be inconvenienced with such taxes.
He said: “The 5 percent excise duty will overburden the industry. As a Minister, I was neither consulted nor obtained a memo to that effect. Even the appropriate lawmakers that were supposed to be talked with have also told me they were not.
”Things are not done that way. Besides condemning the tax, we will take every lawful step to guarantee that the tax does not stand.”
The minister also argued about the large percentage of importation of ICT and telecoms equipment into the country, even when some of these equipment could be acquired in the country.
He gave a marching order to all stakeholders that “henceforth, the Federal Government will not condone importation of anything into the country when it can be manufactured here in the country.
“The sector has to reasonably reduce importation. The Nigerian Communications Commission, NCC, and the National Office for the Promotion of Indigenous Content, NODIT, should carry out this policy.
“By 2025, we’ll be qualified to increase our indigenous content and decrease importation by about 20 percent.”
The Minister’s attack on the excise duty is coming after major stakeholders in the sector, including the Association of Licensed Telecoms Operators of Nigeria, ALTON, Association of Telecommunications Companies of Nigeria, ATCON, and National Association of Telecoms Subscribers, NATCOMS, also kicked against the motion, interpreting it as anti-people, provocative, unusual, cold and unreliable.
At a stakeholders’ forum organized in Abuja by the NCC to shed light on its proposed commission, they also complained that such imposition would help aggravate the misery of the Nigerian masses who already had been pushed into suffering and severe poverty.
The new five percent Excise Duty is part of the new finance act signed into law by the President in 2020. It is meant to be received by the Nigerian Customs Service, and President Buhari gave a ruling that it should be carried out on all telecoms service providers in the country, also on all local and foreign goods and services.
The Minister of Finance, Budget, and Planning, Mrs. Zainab Ahmed, had also at that event, persuaded stakeholders to assist the commission, saying the decision was informed by the dwindling revenue of the federal government from oil and gas.
She said other countries in Africa, involving Malawi, Uganda, and Tanzania, among others, have all keyed into the revenue generation structure.
Nigeria’s 5G Network Subscriptions Soar to Half a Million, Broadband Penetration at 47.01%
The Executive Chairman of the Nigerian Communications Commission (NCC), Prof. Umar Danbatta, revealed that Nigeria’s Fifth Generation (5G) network subscriptions have surpassed half a million users.
Broadband penetration has surged to 47.01% as of July 2023, marking a significant leap in the country’s telecommunications landscape.
Speaking from Kano, Prof. Danbatta highlighted the remarkable achievements of the telecoms industry since 2015. In July, he reported that 5G subscriptions had surged to over 60,000 in the nation.
Also, he emphasized the nation’s ambitious goals, aiming to achieve 50% broadband penetration by the close of 2023 and a remarkable 70% broadband penetration by the conclusion of 2025.
In a statement, Prof. Danbatta stated, “Moreover, the telecommunications sector has undergone a substantial transformation, with its contribution to the Gross Domestic Product (GDP) growing from 8% in 2015 to an impressive 16% quarterly as of the second quarter of 2023, signifying its growing significance to the Nigerian economy.”
He further elaborated, “Furthermore, the authorization of additional telecommunications companies to operate within Nigeria’s telecoms sector has led to a remarkable upsurge in investments. In 2015, the sector attracted $38 billion in investments, a figure that has now soared to an astonishing $75 billion and continues to rise daily. Notably, the NCC’s sale of 5G C-Band Spectrum has generated over $847.8 million in revenue for the Federal Government.”
In related news, the Minister of Communications, Innovation, and Digital Economy, Bosun Tijani, emphasized Nigeria’s commitment to bolstering telecommunication connectivity in unserved and underserved communities.
Minister Tijani stressed that connectivity serves as a catalyst for progress and highlighted the nation’s eagerness to establish partnerships aimed at bridging the digital divide.
Nigerian Communications Commission Reports Remarkable Growth in Telecom Sector
Prof. Umar Danbatta, the Executive Vice-Chairman of the Nigerian Communications Commission (NCC), has revealed impressive figures showcasing the robust growth of telecom investments in the country.
During a recent media interaction held in Kano on Saturday, Danbatta disclosed that the telecom investment inflow in Nigeria had surged from $38 billion to an astounding $77 billion by the second quarter of 2023.
Also, he highlighted that the telecommunications sector had contributed 16 percent to the nation’s Gross Domestic Product (GDP) during the same period.
Danbatta attributed this growth to a combination of factors, primarily “thorough sustained regulatory excellence and operational efficiency by the commission.”
Since taking office as the EVC of NCC in 2015, he noted that the sector’s contribution to GDP had more than doubled, from around eight percent to the current 16 percent.
In addition to this, Danbatta underscored the industry’s achievements, stating, “We have witnessed explosive growth, improved regulatory standards, and digital innovation that have generated global recognition.”
He further revealed significant milestones in telecommunications usage, with 218.9 million telephone users, 159.5 million internet subscribers, and 88.7 million broadband users in Nigeria within the reviewed period.
However, Danbatta acknowledged that several challenges still hampered the full potential of broadband deployment in the country. These challenges include issues related to the right of way, fiber cuts, high capital requirements for deployment, multiple taxations, and complex regulations.
Nevertheless, Danbatta assured stakeholders that the NCC was committed to addressing these obstacles and navigating through regulatory complexities, digital divide, and literacy issues.
As part of their initiatives to enhance communication and emergency response, the NCC announced plans to establish emergency communication centers in all 36 states of the federation and the Federal Capital Territory, Abuja.
Furthermore, the commission had increased research grants for universities from N20 million to N30 million, benefitting three universities thus far.
Danbatta explained that the NCC aimed to provide accessible and affordable telecom services as an enabler for the country’s economic advancement.
However, he also highlighted some ongoing challenges, such as the wilful destruction of NCC facilities and the burden of numerous taxes imposed on telecommunications companies.
Despite these challenges, the NCC remains committed to engaging with the media industry and the public to ensure transparency and to keep everyone informed about its activities.
Nigeria’s Largest Telecom Operator, MTN, Enhances Broadband Reach with 10MHz Spectrum Approval
MTN, Nigeria’s leading telecom operator, has received approval for an additional 10MHz spectrum allocation within the 2.6GHz spectrum band.
This development is poised to significantly bolster broadband coverage across all 36 states of the federation, including the Federal Capital Territory.
Karl Toriola, Chief Executive Officer of MTN Nigeria, said, “This additional spectrum will empower us to uphold our commitment to delivering high-quality services to our valued customers while actively supporting the Federal Government’s agenda to expand broadband access nationwide.”
This valuable spectrum allocation was acquired from OpenSkys Services Limited, a reputable indigenous Nigerian telecommunications company licensed by the Nigerian Communications Commission (NCC) to provide telecommunication services on the 450MHz frequency band.
The 2.6GHz spectrum band is designated for the deployment of terrestrial mobile broadband services.
According to a report by the GSMA, this spectrum band serves as an ideal complement to the 700MHz-800MHz spectrum bands, forming a formidable combination capable of delivering cost-effective nationwide mobile broadband coverage, encompassing both rural and urban areas.
As of December 2022, broadband penetration in Nigeria stood at 47.36 percent. The Federal Government of Nigeria has set a target of achieving 70 percent broadband penetration by 2025. MTN Nigeria’s acquisition of this broadband spectrum allocation is poised to equip the ICT giant with the capabilities required to offer enhanced broadband services to meet the surging demand for widespread and uniform mobile broadband services nationwide.
In the words of Karl Toriola, “This additional spectrum will empower us to uphold our commitment to delivering high-quality services to our valued customers while actively supporting the Federal Government’s agenda to expand broadband access nationwide.”
MTN believes that the integration of this spectrum allocation will lead to a significant enhancement in the customer experience, aligning perfectly with their dedication to delivering exceptional services.
Also, this acquired spectrum will equip the telecommunications operator with the tools needed to deploy advanced broadband technologies, thereby contributing to the realization of Nigeria’s broadband objectives.
A report by the GSMA underscores the pivotal role of broadband penetration, particularly in developing countries, in driving an increase in Gross Domestic Product (GDP). This highlights the urgent need for continuous development and investment in broadband infrastructure, exemplified by the inclusion of the 2.6GHz spectrum band.
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