According to the Ministry of Communications and Digital Economy, the Federal Government’s projected 5% excise levy will not apply to the digital economy.
In response to the Ministry of Finance, Budget, and National Planning’s recent issuance of its approval for the execution of the 2023 Fiscal Policy Measures and Tariff Amendments, the ministry argued that President Muhammadu Buhari had exempted it from the proposed tax.
Clarification of the situation was provided to journalists yesterday in a statement made accessible and signed by Mrs. Uwa Suleiman, the minister of communications and digital economy.
“President Muhammadu Buhari had on March 21, 2023, approved the exemption of the Telecommunications Sector from the proposed excise duty in line with the recommendations of the Presidential Review Committee on Excise Duty in the Digital Economy Sector,” she stated.
Suleiman stated that on September 5, 2022, a six-member committee that had been established at the minister’s request and with the President’s blessing in order to critically and objectively assess the potential effects on the economy of an additional 5% excise duty tax charge on the digital economy sector was formally inaugurated.
According to her, the committee delivered its findings to the president on February 13, 2023, following five months of thorough and objective deliberations.
The spokeswoman for the minister claimed that the report, which cited undeniable facts, suggested the exclusion of the proposed and afterwards suspended 5% excise duty tax on the digital economy sector.
The unprecedented contribution of the sector to the country’s Gross Domestic Product (GDP), the sustained quantum leap in government revenue, which currently stands at a staggering N594 billion quarterly, and its position as the foundational driver of countless businesses at the micro, medium, and small scale levels are just a few of these facts, according to Suleiman.
According to her, the committee investigated the sector’s existing 41 taxes, levies, and charges “and concluded that instead of burdening the sector with more taxes, concessions should be considered, in order to sustain its unprecedented contributions to the growth of the Nigerian economy. Based on the strength of its findings, the Committee prayed that the President exempts the Digital Economy sector from the proposed additional excise duty.”
She claims that Pantami also emphasized the fact that, in addition to burdening the industry, increasing taxes on it would be difficult for the nation’s citizens and urged the President to consider this while making his choice.
As a result, she claimed that on March 13, 2023, President Buhari approved the following prayer:
“The Government exempts the Digital Economy sector from excise duty charges in order to sustain and enhance use of Digital Economy services and to further benefit from their positive impacts on the economy.”
Upon receiving President Buhari’s endorsement, Suleiman said: “the office of the Minister of Communications and Digital Economy, hereby assures the sector and the general public that the President’s approval, supercedes all other declarations regarding the issue and we stand by it. Any contrary proclamation should be disregarded by the general public.”
She recounted how Pantami had fiercely opposed the planned 5% Excise Duty on Telecommunications Services, arguing that it was unjustified and would burden the nation’s residents.
