By David Akinmola
The Nigerian Communications Commission (NCC) has called on attorneys general and state revenue agencies to join forces in addressing the growing burden of multiple taxes in the telecommunications sector, warning that unchecked fiscal pressures could stall investment and innovation in the industry.
Speaking at the maiden edition of its annual workshop for state attorneys general held in Lagos, the Executive Vice Chairman of the NCC, Dr. Aminu Maida, described the mounting taxes as a serious impediment to sectoral growth. He noted that the telecom sector, despite being a key driver of Nigeria’s digital economy, currently bears the weight of over 54 separate levies—ranging from ecological and effluent discharge levies to capital gains and withholding taxes.
“This workshop reflects our belief that collaboration is not optional—it is essential,” Maida said. “No sector, especially one as critical and fast-paced as telecommunications, can thrive without coordinated governance.”
Valued at over $76 billion, Nigeria’s telecommunications industry supports innovation, governance, financial inclusion, and national security, Maida said. Yet its potential remains under threat due to fiscal and regulatory fragmentation across tiers of government.
He urged the attorneys general to see themselves not only as legal gatekeepers but also as policy enablers who can shape state-level laws and policies to better align with national objectives. “To unlock the full potential of this sector, we must tackle legal, fiscal, and operational bottlenecks collectively,” he added.
Maida reiterated the urgent need to revise the Nigerian Communications Act (2003) to align with today’s economic realities—especially to streamline taxation, eliminate regulatory overlaps, and enhance protection of Critical National Information Infrastructure (CNII).
The Attorney General of the Federation (AGF) and Minister of Justice, Lateef Fagbemi, echoed Maida’s concerns, stating that while Nigeria’s telecom sector is dynamic and expanding—with over 220 million voice subscribers and broadband penetration exceeding 32 percent as of Q1 2025—it continues to face structural challenges.
Fagbemi cited multiple taxation across federal, state, and local levels, vandalism of telecom infrastructure (especially in conflict zones), regulatory duplicity, and inconsistent right-of-way policies as major obstacles to sectoral efficiency and growth.
Referencing a 2023 case of telecom infrastructure vandalism in Kano, he called for stronger intergovernmental coordination and recommended the following measures:
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Harmonised legal and policy frameworks across all levels of government
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Creation of a joint federal-state regulatory forum
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Uniform right-of-way policies
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Strengthened enforcement of telecom infrastructure protection laws
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Accelerated digital transition efforts
Chairman of the Presidential Committee on Tax Policy and Fiscal Reform, Taiwo Oyedele, also spoke at the event, highlighting progress made under ongoing national tax reforms. He noted that reforms have already reduced withholding tax for telecom infrastructure providers from 10 percent to two percent, and completely removed it for sectors like manufacturing—moves aimed at improving business liquidity.
According to Oyedele, Nigeria’s tax-to-GDP ratio has risen from 6 percent to 13.5 percent in just two years. Meanwhile, the share of government revenue spent on debt servicing has fallen significantly—from nearly 100 percent to under 50 percent.
“While these macroeconomic gains may not yet be visible to everyday Nigerians, think of it like planting a tree,” Oyedele said. “The roots—the macro policies—must grow strong before we begin to see the fruits.”
He added that reforms have raised exemption thresholds for small businesses. Data shows only about three percent of the informal sector is capable of paying taxes, making the exemption of the remaining 97 percent a pragmatic decision, he said.
Oyedele also explained that the restructured tax system is more progressive—now better tailored to reflect income levels, value-added services, and capital gains. Taxes on investments and capital have been eliminated altogether.
But he was blunt about the severity of Nigeria’s taxation problem.
“Over 60 federal agencies are collecting one form of tax or another,” Oyedele said. “Nowhere else in the world does that happen.”
He shared the example of a manufacturer whose truck had to obtain 73 stickers and pay over ₦700,000 in fees on a single trip from northern to southern Nigeria. “This is one reason goods become unaffordable to the urban poor,” he noted.
Industry stakeholders say that streamlining the tax landscape is not just about ease of doing business—it’s a matter of national competitiveness.
“Nigeria’s telecom industry has the potential to lead Africa’s digital economy, but that won’t happen unless we eliminate structural inefficiencies like multiple taxation,” said telecom policy analyst, Chinenye Ibekwe. “No investor wants to operate in an environment where policy is unpredictable and taxes are duplicative.”
A senior legal consultant with a major telecom provider, who spoke on condition of anonymity, said many companies are forced to pay the same taxes multiple times across jurisdictions, driving up the cost of network expansion.
As Nigeria’s digital economy continues to expand—encompassing fintech, e-commerce, edtech, and telemedicine—the stakes are growing. Experts agree that the success of President Bola Tinubu’s digital inclusion and infrastructure agenda will depend in part on how quickly the country can reform its taxation and regulatory regime for telecoms.
“The future is digital,” said Fagbemi. “But the foundation must be solid, predictable, and fair—for government, investors, and the Nigerian people.”
