FG Ends 5% Telecom Tax Excise on Voice & Data Services

The Federal Government has removed the 5% excise duty on voice and data services, a move that could ease cost pressures for millions of telecom subscribers.

The Executive Vice Chairman of the Nigerian Communications Commission (NCC), Aminu Maida, confirmed that President Bola Tinubu ordered the scrapping of the levy during discussions on the Finance Act. “President Tinubu directed the removal of the 5% excise duty on telecommunications services,” Maida explained.

Pressure From Operators and Consumers

The excise tax, introduced in 2022 under former President Muhammadu Buhari, was designed to boost non-oil revenue but quickly became a burden. Telecom operators warned that with more than 39 separate taxes already in place, an additional 5% excise duty would harm both the industry and consumers.

The Association of Licensed Telecom Operators of Nigeria (ALTON) had flagged concerns, noting that companies also paid 7.5% VAT and a compulsory 2% annual levy to the NCC. With unreliable electricity driving diesel costs higher, operators argued they could not absorb the tax. Instead, they passed the cost directly to users, pushing the effective tax burden on calls and data to about 12.5%.

Industry analysts say that by the time the levy took effect, subscribers had already faced a 50% tariff increase earlier in the year. This added to the frustration of over 171 million active telecom users across the country.

What Comes Next?

The removal of the duty is being celebrated as a win for consumers, yet questions remain. Analysts point out that despite the government’s decision, other operating costs such as diesel, multiple taxation, and inflation continue to weigh heavily on the telecom sector.

The National Orientation Agency (NOA Nigeria) also reiterated via a post on X saying, this move is set to “bring relief to over 170 million active telecom users across the country.“

The scrapping of the levy could boost digital adoption, but industry players stress that broader reforms are needed to ensure long-term affordability. Nigerians now await to see what it results to in the face of “expensive” data and voice services. Will telecom operators revert or reduce the heavy prices they recently splashed on data and voice services?