Abuja, Nigeria – The Nigerian Senate has passed the controversial Nigeria Tax Bill 2024, reviving a previously suspended 5% excise duty on telecommunications services. The decision, made on May 8, 2025, has reignited strong opposition from telecom operators, consumer advocacy groups, and industry stakeholders who argue that the tax will further burden Nigerian citizens and businesses.
The excise tax, originally introduced in the 2020 Finance Act under former President Muhammadu Buhari, was suspended by President Bola Ahmed Tinubu in July 2023 amid rising inflation and economic hardship.
What Is the 5% Excise Duty?
Excise duty is a specific tax imposed on selected goods and services. As detailed in the 2022 Finance Act, this levy applies to all telecom services regulated by the Nigerian Communications Commission (NCC), covering both prepaid and postpaid services.
According to consulting giant PwC, the duty was previously applied to telecom products like recharge cards and vouchers before being scrapped in 2009. The current legislation seeks to reintroduce this financial obligation, making telecom companies liable for a 5% tax based on the excisable value of their services.
Why President Tinubu Suspended the Tax in 2023
President Tinubu suspended the excise tax on telecommunications services and excise escalations on locally manufactured goods through an Executive Order signed in July 2023.
At the time, Dele Alake, then Special Adviser to the President on Special Duties, Communications, and Strategy, noted that the suspension was intended to ease economic pressures on Nigerians. He also confirmed the suspension of the Import Tax Adjustment levy on specific vehicle categories.
Telecom Operators Sound the Alarm
Telecommunications operators have vehemently opposed the reintroduction of the tax. They argue that implementing the levy will result in a direct hike in data and voice service tariffs, ultimately transferring the financial burden to subscribers.
Engr. Gbenga Adebayo, Chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), previously warned that such a tax would erode industry profits and restrict further investments in critical telecom infrastructure.
Speaking to an online publication, Adebayo emphasized, “We will not accept this legislation. It limits our ability to expand coverage, improve service quality, and promote digital inclusion.”
Consumer Rights Groups Reject Tax
Several consumer protection organizations have joined the resistance against the bill, including the National Association of Telecommunications Subscribers (NATCOMS) and the Association of Telephone, Cable TV, and Internet Subscribers (ATCIS).
NATCOMS President Chief Deolu Ogunbanjo described the bill as an “injustice to both subscribers and operators.” He vowed that his association would challenge the legislation using all available legal means.
Similarly, Sina Ilesanmi, ATCIS President, criticized lawmakers for failing to consult industry stakeholders before passing the bill. “There should be collaboration and transparency. Nigerians deserve to be involved in decisions that directly impact their daily lives,” he said.
Subscribers Speak Out
The proposed tax has drawn harsh criticism from ordinary Nigerians, who argue that the levy is coming at a time when most citizens are struggling to cope with economic pressures.
Joy Esonwunne, a telecom subscriber, lamented the financial strain imposed by rising telecom costs. “My data expenses have doubled—from N10,000 last year to N20,000 this year. It’s disheartening that the government keeps piling pressure on ordinary people,” she said.
Paul Oyewusi, Managing Director of POMA Point Limited, also warned of severe consequences for businesses. “Remote workforces now require double the data allocation. Tariff increases, fuel costs, and power issues are already overwhelming. This 5% tax could be the final straw,” he explained.
NCC Yet to Comment on Passed Bill
When contacted for an official statement, Nnenna Ukoha, Head of Public Affairs at the Nigerian Communications Commission (NCC), acknowledged receiving media inquiries but had not responded as of the time of publication.
However, in an earlier interview with an online media platform, Ukoha disclosed that the NCC had not yet received the official version of the Nigeria Tax Bill for review.
Telcos Say They’re Overburdened with Taxes
According to ALTON, as of August 2024, telecom operators in Nigeria were already subjected to 54 different taxes. Industry experts warn that additional levies could hinder recovery efforts and reduce Nigeria’s competitiveness in the global digital economy.
“We are just beginning to recover from forex devaluation and rising operational costs. This tax will reverse the gains,” Adebayo said. “Telecom should be classified as a social infrastructure, not a luxury.”
Industry Stakeholders Raise Red Flags
Experts across the telecommunications sector argue that excise duties are typically reserved for luxury or harmful goods—like alcohol, tobacco, and expensive jewelry—not essential services such as internet and mobile communications.
Anthony Emoekpere, President of the Association of Telecommunications Companies of Nigeria (ATCON), emphasized that the burden will be felt most by lower-income Nigerians. “Someone recharging N1,000 will notice the extra N50. These charges quickly add up, especially for heavy users and small businesses,” he said.
Adebayo added, “There is also the added challenge of compliance. Operators are now being tasked with collecting and remitting the tax. It’s a logistical and operational strain.”
Legal Battle Set for June 11
In a bold move, NATCOMS has filed a lawsuit against the federal government to halt the implementation of the 5% telecom excise duty. The case is scheduled to be heard on June 11, 2025, at the Federal High Court in Lagos.
Justice Aluko, presiding over Court 7, will determine the legality of the tax reintroduction and whether it can proceed following presidential assent.
What’s Next?
If signed into law by President Tinubu, the Nigeria Tax Bill 2024 will require telecom operators—both local and foreign—to collect and remit a 5% tax on services consumed within Nigeria. This includes data, voice, and potentially other digital communications services.
With mounting pressure from consumer groups, telecom operators, and legal challengers, the bill’s fate remains uncertain. However, one thing is clear: its implementation could reshape the telecommunications landscape in Nigeria, affecting millions of subscribers and businesses nationwide.
Reporting by TJ News Nigeria
Additional reporting by Omajemite Don
