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Nigeria govt considers 9% communication service tax

Nigeria govt considers 9% communication service tax.

The Nigerian government is planning to introduce a 9% communication service tax to be paid by consumers of voice, data, SMS, MMS and pay TV services. The move is reportedly due to efforts by authorities to make up for the shortfall of the falling price of crude oil globally.

According to the Communication Service Tax Bill 2015, currently before the National Assembly, a communication service tax will be imposed, charged and collected - and will be levied on service fees payable by users of electronic communication services.

Service users will required to pay 9% of the service charge for the use of communication service charged by service providers.

Economist Kehinde Adeolu told ITWeb Africa that with the new bill, the government is actively pursuing new ways of generating revenues. "Nigeria majorly relies on crude oil for its revenue and over the past couple of months, the country has been made to see the reason why it can no longer entirely rely on oil. Since Nigeria is a very big telecoms market, the government would generate lots of funds from the tax if it is properly enforced and monitored," he said.

Commenting on the proposed law, PricewaterhouseCoopers Nigeria (PwC) said if passed into law, service providers will be mandated to file monthly tax returns with Nigeria's federal revenue service FIRS, and there are strict penalties for non-compliance.

Federal Inland Revenue Service (FIRS) will collect the tax and its payment together with any interest and penalty into the Federation Account, while the Federal Government will be responsible for the administration and management of the funds.

"All service providers are to file tax returns and pay the tax due not later than the last working day of the month immediately after the month to which the payment relates. Failure to comply with this provision will attract stiff financial penalties on erring entities," the Bill stated.


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