Communications service tax: senate FG on collision course

ABUJA-The Senate and Federal Government may be on collision course over the proposed Communications Service Tax (CST). The Senate described the proposed tax as not only anti-people, but also would make life unbearable for Nigerians.

With the position of the Senate, yesterday, the bill currently before the upper chamber, appears to have suffered a set back.

Speaking, yesterday, in Abuja, during the 2016 budget defence meeting with the Nigerian Communications Commission, NCC, and the Universal Service Provision Fund, USPF, Chairman, Senate Committee on Communications, Senator Gilbert Nnaji, cautioned against the move by the federal government to further burden Nigerians with new taxes, especially in the face of ongoing economic recession.

He also expressed serious concern about the economic implications of the tax, especially on the general welfare of low income earners in the society.

The proposed bill seeks to make provisions for certain compulsory payments from communications consumers across the country.

He said: "There has been strident outcry by consumer rights groups and industry stakeholders against the Communications Service Tax Bill (CST) 2015 currently before the National Assembly.

"It is argued that the bill will limit access to communications as it will affect the lower income consumers, forcing them to abandon or reduce subscription to certain services.

The bill and the citizenry

"This committee is yet to be availed of the contents of this bill but it is important to state unequivocally here that, as the elected representatives of the Nigerian people, while we recognise the current administration's efforts to widen its revenue base, conscious efforts must be made to ensure that the socio-economic well-being of the citizenry remains sacrosanct.

"We assure Nigerians that this committee will engage in wide consultations with all concerned stakeholders in considering this bill if it is referred to it."

The senator, who urged industry players to live above board by improving on the economy, said: "The committee wishes to bear in mind, some salient issues trending in the telecommunications industry in Nigeria.

"These are issues bordering on regulatory and operational environment in the sector, such as the statutory independence of the industry regulator and the obligations demanded from industry operators to observe and respect regulatory directives.

"While this committee will in no way support any draconian regulation by the commission, it will not also fold its arms to witness any disrespect and disregard for the directives of constituted authorities of the commission by any operator under its regulatory oversight.

"From the budget proposal, the total revenue was estimated at N70, 672,492, 000, while total recurrent expenditure amounted to N22, 211, 186, 000, with total capital expenditure and total special projects respectively at N15, 651,475, 000 and N6, 557,708,000.

"Then, there were provisions for transfers to both USPF and federal government, of-which the former got N8, 584, 000, 000, while the latter would be entitled to N17, 668,123, 000."

In their separate responses, the Executive Vice Chairman of NCC, Prof. Umar Danbatta, and the Executive Secretary of USPF, Mr. Ayuba Shuaibu, thanked the committee for its legislative supports, and assured of their determination to diligently implement the budget if passed in due course.