Phone VAT fetches N127b in H1 2022
Value Added Tax (VA) on telephone calls, short message service (SMS or text), data, and other information and communications technology (ICT) services fetched N127.03 billion for the treasury in first half of 2022 (H1 2022).
The National Bureau of Statistics (NBS), which gave the figure in its latest report, said it represents 10.69 per cent of the total N1.19 trillion VAT collected in H1 2022.
“In terms of sectoral contributions, the top three largest shares in Q2 2022 were Manufacturing with 33.08 per cent; Information and communication with 18.98 per cent; and Mining & quarrying with 10.60 per cent,” the NBS said.
The NBS lists the components of ICT as the activities of telecommunications and information services; publishing; motion picture, sound recording and music production; and broadcasting.
Telecom is the largest subsector, accounting for about 80 per cent of total sectoral contribution to Gross Domestic Product (GDP).
In H1 2022, telecom contributed
- N7.94 trillion (76.29 per cent) to nominal GDP
- N4.84 trillion (79.49 per cent) to real GDP
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Calculation of telecom contribution to GDP
Per reporting by The PUNCH, the NBS says it calculates telecom contribution to GDP as follows:
“Telecommunication and Information Services: Gross Output: revenue from telephone, telex, facsimile, telegraph, and other income from satellite and internet services.
“Intermediate consumption: transit fees, operational expenditure, minor repairs and maintenance and other expenses. Publishing: Gross Output: revenue from publishing services.
“Intermediate consumption: This includes details of the cost structure including transportation fees, operational expenditure, minor repairs etc.
“Motion Picture and Sound Recording: Gross Output: revenue generated/total sales from the number of movies and sound recordings produced including revenue generated from TV rights, royalties and fees.
“Intermediate consumption: Detail on the cost structure of operating firms including transportation fees, operational expenditure, minor repairs and maintenance, and other administrative expenses.
“Broadcasting: Gross Output: public corporation data derived from Accountants General’s reports, while the private component relies on revenue generated from services rendered e.g. advertisement.
“Intermediate consumption: details of the cost structure of market participants which include transportation fees, operational expenditure, minor repairs and maintenance.”
Communications and Digital Economy Minister Isa Pantami has argued that telecom pays a total 41 taxes and “excessive taxation has been a central challenge of the Information and Communications Technology sector.”