The Bill for an Act to establish the Communication Service Tax, on
Wednesday, passed its first reading at the Senate
The bill, which was sponsored by a former Senate Leader, Ali Ndume, was
introduced to replace the 2.2 per cent increase in the Value Added Tax being
planned by the Federal Government.
Ndume said that increasing VAT would have devastating effects on the
economy, as it would raise prices of goods and services.
He, however, added that the Communication Service Tax, which charges nine
per cent on calls and data will ensure the distribution of wealth in such a way
that it won’t affect the ordinary people.
The bill reads in part, “There shall be imposed, charged 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 service
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.”
