Subscribers Kick As FG Slams N90.49bn New Tax On Phone Calls

Posted by African Examiner Featured, Latest Headlines, News Across Nigeria Monday, May 23rd, 2022

(AFRICAN EXAMINER) – Telecommunication subscribers are kicking against a new Federal Government directive to impose a tax on telephone calls in the nation to fund free healthcare for the vulnerable.

The telecom tax in the equivalent of a minimum of one kobo per second for phone calls is a part of the sources of funds required to finance free healthcare for the Vulnerable Group in Nigeria, according to the National Health Insurance Authority Bill 2021 signed by the President, Major General Muhammadu Buhari (retd.), last week.

According to the Nigerian Communications Commission, Nigerians made 150.83 billion minutes of calls in 2020. This translates to 9.05 trillion seconds of calls, meaning the new tax will generate 9.05 trillion kobo, which converts to N90.49bn, yearly.

This new tax is coming despite moves by telecom companies to increase the price of calls, SMS, and data by 40 per cent as a result of an unfavourable operating environment.

According to the Health Insurance Act, the Vulnerable Group Fund is money budgeted to pay for healthcare services for vulnerable Nigerians who cannot pay for health insurance in a bid to subsidise the cost of provision of health care services to vulnerable people in the country.

It added that the Vulnerable Group Fund will subsidise the provision of healthcare to children under five, pregnant women, the aged, physically and mentally challenged, and the indigent as may be defined from time to time.

The Act includes a provision under Section 26 subsection 1c which states that one of the sources of money for the Vulnerable Group Fund shall include a telecommunications tax, not less than one kobo per second of GSM calls.

Other sources of funding outlined in the Act includes a basic healthcare provision fund to the authority; health insurance levy; telecommunications tax, not less than one kobo per second of GSM calls; money that may be allocated to the Vulnerable Group Fund by the government; motley that accrues to the Vulnerable Group Fund from investments made by the Council: and grants, donations, gifts, and any other voluntary contributions made to the Vulnerable Group Fund.

According to the new Act, every resident in Nigeria is expected to obtain health insurance.

However, telecom subscribers under the aegis of National Association of Telecoms Subscribers, have said they will reject this new move by the government.

The President of the association, Adeolu Ogunbanjo, said, “It is quite unfortunate that the government is viewing telecoms as a cash cow. We are saying. There is a lot of corruption in the system, and rather than curb that they want to focus on the telecoms sector.