As the new Value Added Tax (VAT) regime takes full effect, 7.5 VAT is now being applied to phone calls and Short Message Services (SMS), leading to increase in calls and SMS charges, and Nigerians have blamed President Muhammadu Buhari for the increase.
TheNewsGuru.com (TNG) reports Buhari proposed the Finance Bill 2019 and, forwarded same to the National Assembly, which the Senate had since passed into law, raising the country’s VAT from 5 to 7.5 per cent.
The law came into full effect from January 2019, with the federal government saying the increase will not affect the poor. However, telecoms operators in the country have since started applying the 7.5% VAT increase on SMS and phone calls, sparking outrage from all and sundry.
Y'ello, this is in compliance with the Federal Government directive of increased VAT (Value Added Tax) to 7.5% applicable to the entire telecoms sector, amongst other sectors.The new VAT reflects the total amount payable on voice calls, data rates and other products/services.~FM
— MTN Nigeria Support (@MTN180) February 16, 2020
Hello @mijahlinga, kindly note that changes have been made to some of our services due to Federal Government implementation of Value Added Tax (VAT) increase to 7.5%. Increment will occur on Voice bundle call tariff, voice call tariff, Data browsing. Thank you. ^Oma
— airtel_care (@airtel_care) February 15, 2020
Pls see the screenshot that indicates the 7.5% VAT charge is now being applied on mobile phonecalls
I guess only the rich make phone calls in Nigeria?
Where are the Buharinomics experts & Ajurian economists that claimed the increase won't affect the poor?
Purveyors of poverty! pic.twitter.com/ihoGghTBID
— The Revolutionary Seeker (WAEC) (@The_Seeker76) February 5, 2020
7.5% VAT deductions on voice calls and text messages? These people are ins**e.
— Ayemojubar (@ayemojubar) February 6, 2020
So apparently, network operators are charging 7.5% VAT on calls. I'd have to monitor my calls, cause all through the VAT/Finance Bill lecture/chats no one mentioned this.
— Tise Somide (@JayTise) February 5, 2020
Recall that the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, at the opening of the 25th Nigerian Economic Summit (NES25) had assured Nigerians the VAT increase will not affect the poor.
At the yearly gathering, the Minister said that raising of VAT to 7.5 percent from 5 percent would affect the wealthy in the society more than the poor in the country.
“The proposed VAT increase is likely to impact more on consumption by the urban communities and the wealthier sections of the population, than on the poor,” Mrs Ahmed said at the event, which was declared open by President Buhari.
The Minister said the 7.5 percent VAT increase proposal was in line with the recommendations of the Presidential Committee on the Funding Options for the Minimum Wage Increase.
Read some reactions from Nigerians after the law came into full effect below:
7.5% vat on calls. Abeg if I call u
1. No more hello hw r u doin, i will just go straight to de point
2. Reply me fast
— Alhab (@ahalilu1) February 5, 2020
7.5% VAT won't affect the poor masses yen yen yen.
7.5% VAT is only for luxuries yen yen yen.
Now MTN is adding 7.5% VAT to calls/texts or sending texts & phone call is for the rich alone?.
The annoying part is we didn't even have good roads to show for all the before before tax.
— Zaddy Ajala (@UNCLE_AJALA) February 5, 2020
7.5% VAT on calls made. This government want to send us back to the village.
— Mister Ajibola 🧢 (@_starbiola) February 6, 2020
7.5% Vat on calls and data. You can see right, the plan is to make people more poor. You Economists should keep your analysis. There's no good side to this… The future right? What happened to vision 2020?
— Adélọ́wọ̀ Adégbóyèga (@GboyeAdelowo) February 5, 2020
FOR YOUR INFORMATION 7.5% VAT on all outgoing calls.😭
7.5% VAT on data purchase😭
Mind the Way you make calls Now 😭 pic.twitter.com/QL52trOxBE
— Wosh Life (@MisterWosh) February 5, 2020
We live in a country where our govement are our problem.
Imagine waking up to make calls then you realized 7.5% VAT is being deducted from every calls you make
Not even 1call self
Now the govement should us a reason for this .
Just imagine 😣😣 pic.twitter.com/LmrlCyWHUT
— Liberty £mpire (@Libertyempire01) February 5, 2020
— Kongming (@LekanOmobaba) February 5, 2020
Government is now charging 7.5 VAT when u make calls..? t this country is finished
— Egbodion Ihenyen (@Stunneri) January 31, 2020
I’ll start writing letters to my friends that talk shit over the phone cos with 7.5% VAT, calls ain’t cheap Baby🤷♀️
— Nwanyi Anambra (@precyfine) February 5, 2020
7.5 VAT is hitting hard on phone calls/SMS/Data. I wonder where else the summaries aren't so apparent. But let's celebrate 30k minimum wage, in what is a pure twist of fate! And don't forget NYSC allowee is now 33k🤔😐 We good🙈🙌🏿
— Clement Igyu (@ClemIgyu) February 15, 2020
People that think they are too big for WhatsApp calls, 7.5% VAT on calls will humble you.
— ENIOLA (@woman__being) February 5, 2020
I swear, no Nigerian should go to hell; the country is already Hell.
No jobs, no light, shitty educational system, insecurity, poor transportation system, low life expectancy, poor health system, #LagosIsWalking, 7.5% VAT even on calls and SMS. Is it a crime to be Nigerian? pic.twitter.com/u3jRrdTCQZ
— Kenechukwu July 29 (@iamKennethAba) February 5, 2020
Meanwhile, the Ministry of Communications and Digital Economy had addressed the development, moving far away from the increase, while also assuring that the Ministry under the leadership of Isa Pantami will protect the interest of all Nigerians.
Uwa Suleiman, Spokesperson to the Minister of Communications and Digital Economy in a statement said the matter was not under the purview of the Ministry.
Uwa said the Ministry had been inundated with complaints and enquiries concerning the 7.5% VAT deductions on voice calls and text messages by telecoms operators.
“While we appreciate the support and efforts of well meaning Nigerians who have sought clarifications in a civil manner, we wish to inform the general public that the issues of VAT do not fall under the Ministry’s purview.
“The office of the Honourable Minister of Communications and Digital Economy is not mandated to handle VAT.
“In the same vein, we also wish to notify the general public that contrary to popular opinion in some quarters, the Honourable Minister of Communications and Digital Economy had no prior consultation or awareness about the development.
“All further enquiries and clarifications may henceforth be directed to the Federal Inland Revenue Service (FIRS), being the proper institution for tax matters,” the statement read.
However, Uwa in the statement assured all Nigerians that the Ministry under the leadership of Isa Pantami, will protect the interest of all Nigerians.