FG has removed 5% Telecom Tax on voice and data services.
NaijaOnPoint Nigeria reports that the Federal Government has officially scrapped the 5% excise duty on telecommunications services, a move expected to ease financial pressure on millions of Nigerian subscribers.
The development was confirmed by Aminu Maida, Executive Vice Chairman of the Nigerian Communications Commission (NCC), who stated that President Bola Tinubu personally ordered the removal of the levy during discussions on the Finance Act.
“President Tinubu directed the removal of the 5% excise duty on telecommunications services,” Maida said, noting that the change will benefit over 171 million active telecom users across the country.
The excise tax was initially introduced in 2022 under the Buhari administration to raise non-oil revenue, covering both voice and data services. Telecom operators were required to remit the tax by the 21st of each month. However, from the outset, the levy faced criticism from operators and consumer advocates alike, who warned it would increase costs for both companies and subscribers.
Telecom operators, already subject to more than 39 different taxes, a 7.5% VAT, and a 2% contribution of annual revenue to the NCC, argued that the excise duty would push the total tax burden on services to roughly 12.5%. The high cost of diesel to power base stations amid unreliable electricity further compounded the sector’s financial strain.
Impact on Consumers
Earlier this year, the NCC approved a 50% increase in telecom tariffs to help operators cover rising costs, including inflation, fuel, foreign exchange shortages, and equipment import expenses. Data prices surged: MTN’s 1.8GB monthly plan rose from N1,000 to N1,500, while a 20GB plan jumped from N5,500 to N7,500. SMS rates increased from N4 to N6 per message, and the cost of 1GB of data climbed from about N287 to roughly N431, depending on the plan.
The tariff hikes had already started straining household budgets, particularly for lower-income users who were forced to reduce data usage, switch to cheaper plans, or limit non-essential app usage.
The removal of the 5% excise duty is therefore expected to provide immediate relief to consumers while stabilizing the telecom sector and encouraging continued growth in Nigeria’s digital economy.