FG slams new tax on telephone calls, data

The Federal Government has slammed a new tax on phone calls in the country to fund free health care for the vulnerable group in Nigeria.

This is despite recent moves by telecommunication companies to increase the price of their services as a result of an unfavourable operating climate.

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 health care for the vulnerable group in Nigeria.

This is contained in the National Health Insurance Authority Bill 2021 signed by the President Muhammadu Buhari last week.

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

The Fiscal Policy Partner and Africa Tax Leader at PricewaterhouseCoopers, Taiwo Oyedele, in an interview with The Punch, said, “Section 26 of this new law imposes a telecommunications tax of not less than 1kobo per second on GSM calls. With call rates at about 11kobo per second, this translates to a 9 per cent tax on GSM calls.

“The tax is one of the sources of money to the Vulnerable Group Fund to subsidise the provision of healthcare to the group defined to include children under five, pregnant women, the aged, physically and mentally challenged, and the indigent as may be defined from time to time.”

According to the 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.