The Nigerian federal government is set to reintroduce the formerly suspended telecom tax to access a $750M World Bank loan. According to the Stakeholder Engagement, the reintroduction of the telecom tax is part of a reformation program between Nigeria and the World Bank.
The document on the World Bank website highlighted that the Nigerian government plans to bring back the excises on telecom services and EMT levy on electronic money transfers, among other taxes, through the Nigerian Banking System.
The suspension of telecom tax placed by the President of Nigeria, Bola Ahmed Timubu, in July 2023 might be lifted to meet the program’s development requirement for the yet-to-be-approved $750M World Bank loan, which was initiated in 2021 but halted due to unknown reasons.
The program development aims to strengthen the financial position and improve its adequacy in managing the government’s mobilized domestic resources, such as tax and customs compliance and oil revenues.
The carefully planned tax reformations under the ARMOR program significantly influence various sectors. Some sectors that experience the excise include oil and gas, agriculture, automobile telecommunication, banking, exchange market, and international traders.
A document from the Association of Licensed Telecom Operators of Nigeria states, “Domestic Revenue Mobilization drive in the government ARMOR program seeks to increase revenue on some targeted industries and sectors of the economy.Â
Specific groups and agencies within affected sectors include the Association of Licensed Telecom Operators of Nigeria: The introduction of excises on telecom services requires that all telcos are mobilized to fully participate in collecting such revenue.”
It also said, “Key public sector agencies regulate services subjected to the newly introduced excises. Introducing the new revenue measures will require the application of existing regulatory mechanisms available within these institutions. The concerned institutions include the Nigerian Communication Commission and the Central Bank of Nigeria.”
“The document says there are agencies to police some of the issues covered in the ARMOR program regarding policy framework on matters of public interest in Health and Environmental Protection.”
