Telecom expansion hindered by multiple levies by fed, state, and local govts
By Jeph Ajobaju, Chief Copy Editor
Telecom operators have lamented that illegal taxes are eating up funds required for network expansion to upgrade service delivery and lift the national economy.
Association of Telecommunications Companies of Nigeria (ALTON) Tony Emoekpere disclosed the sector is hobbled by multiple regulations that produce multiple taxation being collected by federal, state, and local governments.
Emoekpere told the House of Representatives Telecommunications Committee that telcos are also being charged illegal taxes which impact them negatively, and requested legislation to create an enabling environment for the sector.
He also sought a special funding vehicle for telecom operators to help bridge the infrastructure funding gap in the country.
He stressed “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 [CBN] 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.”
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Request for special funding concessions
“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 the Infrastructure Corporation of Nigeria,” Emoekpere added, per The PUNCH.
“A special purpose infrastructure funding vehicle established 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.”
Emoekpere suggested Nigeria could also adopt for the telecom sector the model practised by the Nigerian Local Content Management Board for the Local Content Fund in the oil and gas industry.
He equally told the lawmakers:
- Telecom operators are still using their old tariff template while the cost of doing business in Nigeria has risen sharply due to a myriad of factors impacting businesses.
- Right of Way (RoW) charges are still very high in different states, including Lagos and the Federal Capital Territory (FCT).
- Nigeria’s 70 per cent broadband penetration target cannot be achieved with high ROW charges and states must adopt the uniform N145 per metre or waive ROW fees altogether
- The federal and state governments should adopt information communication technology (ICT) in governance, healthcare, education, and agriculture to encourage operators.