Illegal taxes impacting network expansion – Telcos
Funding required for network expansion is now being redirected to the payment of illegal taxes, telecommunication operators have lamented.
The operators stressed that the telecom industry was faced with multiple regulations that had led to multiple taxation, ensuring that operators paid taxes to Federal Government, State Government agencies, and local governments.
They noted that those taxes, some illegal, were impacting their members negatively.
The Association of Telecommunications Companies of Nigeria disclosed this while meeting with the House of Representatives Committee on Telecommunications to seek legislation to create an enabling environment for the sector.
While discussing with the committee, the President of ATCON, Tony Emoekpere, clamoured for a special funding vehicle for telecom operators in the country to help them bridge the infrastructure funding gap in the country.
He said, “Telecom is a capital-intensive sector, requiring significant CAPEX investment to facilitate efficient communications service provision.
“We would like this committee to drive strategic engagement with the Central Bank of Nigeria on behalf of the telecom sector to bridge the infrastructure funding gap by providing accessible low-cost intervention funds for the rapid deployment of broadband infrastructure nationwide, including in rural areas.
“In particular, special funding concessions should be provided to the telecommunications industry similar to those provided to the manufacturing sector, and the development of a special infrastructure funding scheme for operators in concert with Infrastructure Corporation of Nigeria (a special purpose infrastructure funding vehicle establishment by the Central Bank of Nigeria will also help harness opportunity for Nigeria’s telecoms infrastructure development through the origination, structuring, execution and end-to-end management of financing for infrastructure development projects to resolve the existing infrastructure deficit.”
He noted that the country could also adopt the model practised by the Nigerian Local Content Management Board for the Local Content Fund in the oil and gas sector in the telecoms’ industry.
Emoekpere also highlighted that operators were still operating their old tariff regime while the cost of doing business in the country had risen sharply due to a myriad of factors impacting their businesses.
He further disclosed to the committee that Right of Way charges were still very high in different states, including Lagos State and the FCT.
He declared that the country’s 70 per cent broadband penetration target cannot be achieved with high ROW charges, and states must adopt the uniform N145 per meter or waive ROW fees.
He further urged the Federal and State Governments to activate the use of ICT in governance, health care, education, and agriculture, to encourage operators.
