The Federal Government has revealed that they made N127.03bn from Value Added Tax on calls, SMS, data, and other information and communication services in the first six month of the year.
According to report released by the National Bureau of Statistics, NBS, “10.69 per cent of the total N1.19tn that was collected as VAT within the period under review. The government charges 7.5 per cent forr the consumption of telecommunication services.”
Speaking on the contribution of the sector in the second quarter of 2022, the NBS revealed that “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 information and communication sector comprises of the activities of telecommunications and information services; publishing; motion picture, sound recording and music production; and broadcasting according to the NBS’s grouping for Gross Domestic Report.
Telecoms is the largest subsector in the sector contributing about 80 per cent of the total sector’s contribution to GDP. The subsector contributed 76.29 per cent, and 79.49 per cent to the sector’s nominal and real GDP in the first half of 2022.
It contributed N4.84tn to the nation’s real GDP and N7.94tn to its nominal GDP. To calculate the sector’s contribution to the economy, the NBS considers, “Telecommunication and Information Services: Gross Output: revenue from telephone, telex, Facsimile, telegraph, and other income from satellite and internet services.
According to data the federal government have improved in VAT coverage and collection. Considering dwindling oil revenue, the government has increased efforts at increasing tax revenues. Despite contributing a chunk of VAT revenues, the government recently made moves to add a five per cent excise duty on telecom’s services which would have increased telecoms consumption tax to 12.5 per cent.
