DigitalPR With Celestine Achi: Communication Service Tax Bill: No Thought for the Poor and Vulnerable By Festus Badewosi

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Communication Service Tax Bill: No Thought for the Poor and Vulnerable By Festus Badewosi

Monday, May 16, 2016




The National Assembly must be stopped before it increases the socio-economic burden Nigerians are currently experiencing.

By contemplating another tax regime through the introduction of the Communication Service Tax (CST) Bill, which will impose 9% service charge on the consumer of communication service, the National Assembly has demonstrated that it is anti-people. Tell me the true representative of the people who will conclude that the best way to reward the people for electing him or her is to impose additional hardship on the subscribers through their service providers in a communication industry that is already over-taxed?

By virtue of the proposed CST Bill, communication service users will pay the 9% service charge for voice calls, data usage, Pay TV, short message service (SMS) and multimedia service (MMS).

It is ironic that this is happening at a time the Nigerian government should be encouraging more access to communication services, particularly by the low-income earners. The impact of mobile penetration on economic growth is amazing. A recent World Bank research revealed that a 10% increase in mobile broadband penetration in low to middle income countries such as Nigeria leads to a 1.38% increase in GDP growth. This can only happen if investors and other stakeholders in the communication sector are encouraged to offer affordable services, and the subscribers themselves are not over-taxed as a result of their use of the services.

Rather than raise more hurdles on the communication highway, it behoves the National Assembly to seek ways of opening up opportunities for the unconnected to be connected. Only about 83 million people in Nigeria have access to mobile communication services, which is half the population. The key challenge to reaching the underserved citizenry is affordability.

The coalition of telecommunication groups, led by the Global System for Mobile Communication Association (GSMA), recently protested to the Federal Government about the proposed Bill. In the petition, which was copied to the leadership of the National Assembly, the group said: Further taxation on electronic communication services will hit lower income consumers the most, who are already struggling due to the adverse economic situation and increased price pressure and for whom affordable access to information communication technology is critical to their social and economic inclusion. Moreover, this will result in a double taxation for consumers who already pay Value Added Taxes (VAT) on telecommunications services.”

The National Assembly must discontinue further action on the CST Bill. It is anti-people! 

Badewosi is a consumer rights advocate resident in Lagos
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Join the masses and say #NoToCommServiceTax

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