Communications Minister denies knowledge of VAT on calls, SMS, data
By Ngozi Onyeakusi– The Minister of Communications and Digital Economy, Dr Isa Pantami, has denied knowledge of additional charges on voice calls, SMS and data introduced by Mobile Network operators occasioned by the recent 7.5 per cent increase in Value Added Tax (VAT) by the Federal Government.
Pantami subsequently asked subscribers who have expressed concern over the development to direct their grievances to the Federal Inland Revenue Service.
Patanmi, in a statement on Thursday, said his office had been swamped with complaints and enquiries concerning the new Value Added Tax charges on voice calls and text messages introduced by Mobile Network Operators.
He said he was not aware of the development as he had not been consulted on the matter.
Telecommunication operators had announced their decision to charge VAT on products and services effective February 1, 2020 in line with the 7.5 VAT increment by the Federal Government.
The country’s Value Added Tax was reviewed upwards from five per cent to 7.5 per cent by the Federal Government as part of new fiscal measures to increase revenue from the non-oil sector.
In the statement signed by the Spokesperson to the Minister, Mrs Uwa Suleiman, Patanmi said, “While we appreciate the support and efforts of well-meaning Nigerians who have sought clarifications in a civil manner, we wish to inform the general public that the issues of VAT do not fall under the ministry’s purview.
“The office of the Minister of Communications and Digital Economy is not mandated to handle VAT.
“All further enquiries and clarifications may henceforth be directed to the Federal Inland Revenue Service, being the proper institution for tax matters.
“In the same vein, we also wish to notify the general public that contrary to popular opinion in some quarters, the Minister of Communications and Digital Economy had no prior consultation or awareness about the development.”
Nigerians had taken to social media to lodge complaints of additional charges on text messages and voice calls to their network operators, the Nigerian Communications Commission and Patanmi.
MTN had, for instance, added N0.7 to the SMS tariff of N4, thereby charging subscribers N4.7 per SMS.
One subscriber, Joshua, argued that subscribers were being swindled by operators as VAT only applied when buying a product or service not when it was in use.
Joshua, via the Twitter handle @niphijosh said, “Daylight robbery. This is an abuse of VAT. You only pay VAT when transacting and not for what you are using. You pay VAT when you buy a TV and not when using the TV. What is the Value Added Tax on calls? You pay VAT when buying recharge cards and not when you use them.”
Another subscriber via Twitter handle @aylimitless said the new charges were not fair on subscribers.
He said, “Who else is getting this ‘inclusive of VAT’ message in all SIMs? It’s so annoying, which means my call rate from my Airtel to any network is now 0.12/sec instead of 0.11 and for MTN, 0.16/sec instead of 0.15, text messages: 4.10. This is bad, it ain’t fair!”
Meanwhile, Pantami has asked the National Broadband Plan Committee to focus more attention on the 4G network in the quest for a wider broadband penetration in the country.
Pantami who spoke during a visit to the committee’s secretariat on Thursday also asked the team to actualise the 70 per cent broadband penetration target by 2023.
The minister said the 70 per cent target by 2025, as previously announced, was not ambitious enough as government actually targeted 100 per cent penetration by 2023.