Nigerians will suffer more in the coming months following the decision of the Federal Government to impose a five per cent excise duty on telephone recharge cards and vouchers.
President Muhammadu Buhari gave the approval after signing the Finance Act 2020 presented by the Minister of Finance, budget and National Planning, Zainab Ahmed.
According to reports, recharge cards and vouchers are part of the new items on the list of goods that will be taxed in the Finance Act.
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Although no rate was stated in the act, the new excise duty on recharge cards will increase call costs and add to other taxes levied on telcos operating in the country.
According to a circular, the minister has asked the Nigerian Customs Service to start collecting 5% excise on mobile telephones, electricity meters (components) and set up boxes.
After the collection of the levy, the Buhari government is expected to raise at least N150 billion while customs will get about 10 billion, which is a 7 per cent collection fee.
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Section 21 (1) of the Act describes goods liable to excise duty as “Goods imported and those manufactured in Nigeria and specified in the first schedule of this Act shall be charged with duties of excise at the rate specified under the duty column in the Schedule.”
Subsection 2 further added that “telecommunication services provided in Nigeria shall be charged with duties of excise at the rate specified under the duty column in the Schedule as the President may by Order prescribe pursuant to section 13 of this Act”.
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