Senate Introduces 9% Communications Tax

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A bill for an Act to introduce tax on Communication Services and Cable television services was on Wednesday scaled through first reading in the Senate.

The bill sponsored by Senator Ali Ndume titled, “A Bill for an Act to establish the Communication Service Tax” if passed and signed into law will provide for the charging of 9 per cent on calls and data usage and the pay per view cable subscribers.

“There shall be imposed charge payable and collected a monthly Communication Service Tax to be levied on charges payable by a user of an Electronic Communication Service other than private Electronic Communication Services.

“The tax shall be levied on electronic communication services supplied by service providers.

“For the purpose of this clause, the supply of any form of recharges shall be considered as a charge for usage of electronic communication service.

“The tax shall be levied on such Electronic Communication Services like Voice Calls; SMS; MMS; data usage both from telecommunication services providers and Internet service as well as Pay per View TV Stations.

“The tax shall be paid together with the electronic communication service charge payable to the service provider by the consumer of the service.

“The tax is due and payable on any supply of electronic communication service within the time period specified under sub-clause (5) of whether or not the person making the supply is permitted or authorized provider of electronic communication services” the bill read.

The bill further proposed that“The tax return shall be in a form prescribed by the FIRS and shall state the amount of tax payable for the period and any related matters that may be required.

“The return and the tax due to the accounting period to which the tax return relates shall be submitted and paid to the FIRS not later than the last working day of the month immediately after the month to which the tax return and payment relates.

“The FIRS may extend the period within which the tax return may be submitted and payment made on application in writing by a service provider, where good cause is shown by the applicant.

“The extension shall be communicated to the applicant in writing and shall state the circumstances under which the tax return shall be submitted for the particular period.

“A service provider who without justification fails to submit to the FIRS the tax return by the date is liable to a pecuniary penalty of N50, 000 and a further penalty of N10,000 for each day the return is not submitted.”

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